Protecting your money
By Paul Wesslund from May 2014 Issue
A Kentucky history of well-managed co-op finances
More than 900 local, customer-owned electric cooperatives operate in 47 states. They're successfully delivering affordable and reliable electricity to 42 million customer-members. And Kentucky can take some of the credit.
I want to elaborate on the story on page 10, "Keeping co-ops financially strong."
That item highlights the service of Kentucky co-op CEO Burns Mercer of Meade County Rural Electric Co-op, on the board of a national finance co-op.
That co-op, the Cooperative Finance Corp., is a $22 billion provider of financing for electric co-ops. That's important, because building power plants, transmission and distribution lines, and all that goes with it, is expensive business.
Mercer's term as board president ends as CFC turns 45. What's amazing to know is that the man who started CFC grew up on a farm just up the road from the Meade County co-op.
J.K. Smith was born in Ekron, and worked for the co-op in Brandenburg.
Smith understood the power of co-ops banding together. He was the first head of the Kentucky Association of Electric Cooperatives. Over the decades KAEC has created strength and efficiencies for electric co-op members by representing them in Congress and the state legislature, by manufacturing transformers, providing safety instruction, and by publishing Kentucky Living.
Smith recognized the importance of money to a growing industry. So in the late 1960s, he headed a national study group. The result was CFC, and Smith was its first board president and CEO. Smith died in 2008.
Caring for the money of co-op members is also a feature of The Future of Electricity column.
That column describes the high-level energy discussions in Washington, D.C., that will have huge effects on what you pay for electricity. Electric co-ops have lobbyists working with members of Congress, but they stay in touch with policymakers in other ways too.
Photos in that column show a group of electric co-op accountants from Kentucky meeting with Rep. Ed Whitfield, a Kentuckian who chairs a key House energy subcommittee.
The accountants were in Washington to stay up-to-date on their profession, with sessions ranging from interest rate forecasts to cyber security requirements. Their meeting is just one recent example of a history of protecting the finances of electric co-op members.