Co-ops drive economic development
FOR NEARLY A CENTURY, electric cooperatives have been essential to the economic vitality and overall quality of life in communities nationwide. America’s electric cooperatives made modern living in rural America possible. In the early 1930s, nearly 90% of American farms lacked electricity. Thanks to cooperatives, by the early 1950s, more than 90% of America’s farms enjoyed the benefits of co-op provided power. Today, electric cooperatives power more than 21.5 million businesses, homes, schools and farms in 48 states.
Electric cooperatives are now repeating history by delivering affordable, reliable broadband service—deemed a “modern-day necessity” by the Federal Communications Commission. This new service is creating new ways to live, learn and earn in sparsely populated areas. Today, co-ops deliver broadband service to 675,000 homes and constitute the fastest-growing group of broadband providers, infusing new economic opportunities to America’s rural communities.
Simply put, electric cooperatives continue to have a significant impact on the nation’s economy. According to a new economic study by the National Rural Electric Cooperative Association and the National Rural Utilities Cooperative Finance Corporation, electric co-ops contributed $554 billion to U.S. gross domestic product between 2018 and 2022, for an average of $111 billion annually.
For the same five-year period, electric cooperatives generated an average of nearly 623,000 jobs annually for Americans nationwide, providing $51 billion in pay and benefits. By comparison, FedEx, the nation’s fifth largest private employer, directly employs 547,000 workers worldwide.
Since electric cooperatives serve 92% of the nation’s “persistent poverty counties,” the co-op contribution to local economies is particularly critical. Between 2018 and 2022, electric co-ops collectively returned $7 billion to their members, further benefitting the communities they serve.
Much of the economic impact can be traced to investments electric cooperatives made in the nation’s infrastructure. Between 2018 and 2022, these investments totaled nearly $409 billion nationwide, including $75 billion on capital expenses, $304 billion in operational costs and $24 billion toward maintenance activities.
These investments are also being used to enhance the reliability of the grid and hasten energy innovation and the deployment of renewable energy. Electric cooperatives own more than 1.6 gigawatts of renewable capacity and have long-term power purchase agreements for another 9.8 GW. Using federal funding from the Inflation Reduction Act, as well as two sustainability bonds totaling $800 million issued by CFC since 2020, electric cooperatives are poised to expand their efforts to responsibly meet tomorrow’s energy needs.
The economic benefits of electric cooperatives underscore the ingenuity of the cooperative model—consumer-owned, community-focused nonprofit organizations working to power and empower communities across the nation.
