Why Member Services in Electric Cooperatives are Critical
If you’re reading this, you might already know that rural electric cooperatives are driven by a focus to support the evolving needs of members and a mission to strengthen local grid resiliency. That drive, coupled with the rapidly expanding distributed energy resource (DER) and electric vehicle (EV) markets, has positioned electric cooperatives at the forefront of the burgeoning green energy boom. Still, as a natural monopoly operating within narrow margins, it’s easy to lose sight of what matters most: member satisfaction. Fortunately, member-centric organizations like electric cooperatives have an opportunity to meet their members right where they are and work together to not only power their communities, but also empower members to save energy and money, and support sustainability.
Cooperative Difference and Principles
Before we dig into the future of green technologies and member satisfaction, let’s look at where electric cooperatives have been. Founded in response to the Rural Electrification Act of 1936, rural electric distribution cooperatives were established to provide electricity to rural areas deemed too costly to serve by investor-owned entities. Today, there are customer-owned electric cooperatives that serve 42 million people in 47 states with a distribution system that covers over half of the nation’s landmass according to The National Rural Electric Cooperative Association.
Cooperatives worldwide continue to operate according to the same core principles and values adopted by the International Cooperative Alliance in 1995. These principles are a key reason that America’s electric cooperatives operate differently from other electric utilities, putting the needs of their members first.
- Open and Voluntary Membership – Membership in a cooperative is open to all people able to use their services and willing to accept the responsibilities of membership, without gender, social, racial, political, or religious discrimination.
- Democratic Member Control – Like a union, cooperatives are democratic organizations controlled by their members who actively participate in setting policies and making decisions. The elected representatives are accountable to the membership. In primary cooperatives, members have equal voting rights (one member, one vote) and cooperatives at other levels are organized democratically.
- Members’ Economic Participation – Members contribute equitably to, and democratically control, the capital of their cooperative. At least part of that capital remains the common property of the cooperative. Members usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: developing the cooperative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the cooperative, and supporting other activities approved by the membership.
- Autonomy and Independence – Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.
- Education, Training, and Information – Education and training should be available to members, elected representatives, CEOs, and employees so they can contribute effectively to the development of their cooperatives. Communications about the nature and benefits of cooperatives, particularly with the general public and opinion leaders, help boost cooperative understanding, and, as we’ll soon see, can lead to better programmatic enrollment and more.
- Cooperation Among Cooperatives – Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional, and international structures.
- Concern for Community – While focusing on member needs, cooperatives work for the sustainable development of their communities through policies accepted by their members.
These core principles help focus the mission of electric cooperatives, no matter where they’re located, which is to serve the members within these communities. And that means keeping the lights on and the electricity affordable, which remains a challenge in an ever-evolving world. Fortunately, some electric cooperatives are working to meet the changing needs of their members, through distributed energy resource (DER) technologies, demand flexibility programs, and beyond.
The Virtues of Enhancing Customer Service to Members
One of the best ways to serve the community is to enhance member services, whether that’s helping the folks in your utility area get the green energy they might want, keeping costs down, and ensuring the lights stay on. As the costs of rooftop solar, storage and other distribution generation technologies continue to decline, utilities are challenged to balance member needs with their ability to provide access to emerging technologies.
Additionally, as energy demand increases, infrastructure ages, and costs increase, electric cooperatives continue to look for ways to reduce spending on operations and maintenance without affecting energy delivery or customer service levels. That leaves opportunities for forward-thinking utilities to take advantage of the many digital tools and member touch points available to them.
Encourages Program Growth
Electric cooperatives are perfectly poised to bring new technologies and tailor-made programs to their members. Green technology initiatives like managed charging, virtual power plants, or demand flexibility programs help keep rates low while improving grid resiliency. In fact, some cooperatives are now offering member-connected distributed energy resources (DER) programs becoming community leaders– and distribution-scale solar.
Distributed generation appeals to many electric cooperatives because it can help avoid demand and energy charges, resulting in positive net project economics. And remember: these technologies offer a non-wired alternative to the costly infrastructure developments needed otherwise to meet rising demand; with DER technologies, you can have your cake and eat it too.
Better Revenue Opportunities
Improving the member experience offers substantial value to any electric utility. In fact, new research has found that satisfied members result in increased profits. When members are satisfied with their service, they’re more likely to become loyal to a company and request additional services.
Furthermore, today’s digital customer experience solutions enable utilities to do more than help customers with their immediate needs. They make it possible to support customers through every part of their journey including activating services, taking control of consumption habits, adding new services to meet their budget, and processing the incentives that drive member participation in demand flexibility programs. Beyond enhancing the member experience, these digital tools benefit member lifestyles, while meeting global sustainability goals.
Enhances ESG Ratings
As scientific evidence increasingly underscores the urgency to address climate change, and with governments and the financial markets responding accordingly, demands on energy companies have escalated in scope and sophistication: more detailed ESG reporting, more transparency on environmental impact, improvements to enhance grid-resiliency, and tangible steps toward a carbon-neutral future. Environmental, social, and governance (ESG) standards consider the impact a company has on its employees, customers, and the communities where it operates. ESG is an important tool for the energy industry as efforts factor into increased deal activity and critical revenue streams, according to a report issued by PwC.
Managing Rural Utilities: Challenges and Long-Term Solutions
Caught amid rising consumer expectations, legislative and regulatory mandates, and increased competition; the customer-centric, electric cooperative must continue to identify and evaluate new member solutions, especially around competitive or non-traditional services. New value-added and revenue-generating services may include support for distributed generation, options to buy new energy management or demand response technologies, and/or partnerships with electric vehicles, charging, and battery storage companies. Enhancing member experience practices and enabling digital technologies offers a wide variety of opportunities and solutions to help address these industry trends and transform the member relationship in support of our energy future.
Electric Cooperatives & Member Services Conclusion
With more energy choices emerging, members are expecting the same level of service from electric cooperatives they’ve grown accustomed to from other businesses. As a result, co-ops must not only deliver better best-in-class member experiences but also remain agile and ready to adapt to ever-changing technology. To help accomplish this goal, electric cooperatives around the world are activating members by investing in the member engagement tools that allow them to deliver the right message, through the right channel, and at the right time. Doing so not only builds rapport with members, but also provides them with the necessary information to make an informed decision about how they engage with the types of demand flexibility programs that empower electric cooperatives to enhance grid resiliency, lower energy spending, and decrease harmful carbon emissions.