Measuring the value of membership

line workers smiling
Headquartered in Huntley, Montana, Yellowstone Valley Electric was a Basin Electric member until the
early 2000s and then rejoined the co-op in 2013.

Each of Basin Electric’s 140 members spanning nine states joined the cooperative for a different reason. For some, it’s the value of transmission and delivery. For others, it’s the investments in power and infrastructure to ensure cost-effective, reliable service for generations. 

We talked with two members – Corn Belt Power Cooperative and Yellowstone Valley Electric Cooperative – to hear firsthand why they find it valuable to be a member of Basin Electric.

Yellowstone Valley Electric Cooperative
Headquartered in Huntley, Montana, Yellowstone Valley Electric serves 21,000 meters. They receive 83-84% of their power supply from Basin Electric.

Yellowstone Valley Electric was a Basin Electric member up until the early 2000s and then rejoined the co-op in 2013. Brandon Wittman, Yellowstone Valley CEO and general manager, says they learned a lot during their time away from Basin Electric, and are happy to be back with the co-op again.

“It’s a volatile world out there. Basin has a long-standing history and a tremendous amount of assets, and they’ve managed those assets well. So I would say stability is a huge benefit of Basin Electric,” Wittman says. 

Corn Belt Power Cooperative
Located in Humbolt, Iowa, Corn Belt Power joined Basin Electric more than a decade ago. At the time, they had been in a joint dispatch for many years, and that dispatch decided to join Midcontinent Independent System Operator (MISO). 

“We had a choice to join MISO or become a Basin member. Looking at the considerations, we felt Basin was the better option– mostly looking at scope and scale,” says Ken Kuyper, executive vice president and general manager of Corn Belt Power. “Basin is a part of an RTO [regional transmission organization], and size has a lot of advantages in an RTO market. We saw value in being associated with a cooperative instead of an RTO directly.”

Long-term perspective
Large generating assets require large capital commitments, which in turn require financing. Having long-term member contracts allows for certainty of repayment by the lenders and a lower interest rate. Lower interest rates for the generation and transmission cooperative (G&T) allow for lower member rates, which allows for the G&T to operate at lower equity levels.

Basin Electric is able to do long-term planning because there is a long-term member contract commitment. This commitment allows for long-term generating assets, regardless of fuel source (natural gas, coal, wind, solar, etc.).

“Some don’t like the long-term contracts that Basin has. I have the opposite view. I think it makes it easier to manage your co-op because you have that long-term stability,” Wittman says. 

Consistent rates
Within the cooperative, rates are always one of the most discussed topics. Every member hopes for consistency in rates because they know their customers at the end of the line need affordable power. As a power supplier, Basin Electric remains the lowest-priced cooperative and G&T in the region.

“When our members come in, they want to talk about rates, and it’s a lot easier discussion if you can predict your rates will be stable into the future,” Kuyper says. “Growth in sales helps to spread our cost over a broader footprint. By being able to hold or decrease rates, it helps when trying to attract certain industries.”

Basin Electric’s democratically-elected board of directors serves as the cooperative’s ratemaking authority, setting rates for the sales to members. They have not increased rates since 2016 and even approved a rate decrease for 2020. The long-term forecasting of rates helps make for an easier conversation with end-user consumers.

“When a member opens the bill, the first thing they look for is the number. Basin Electric has supported us that way tremendously. They’ve kept very stable rates, and they’ve actually reduced rates over the years. We haven’t raised our rates since May 2011 so we’re about to go 10 years without a rate adjustment,” Wittman says. “Our biggest expense is power supply and because of that, Basin remaining as stable as they are has allowed us to remain stable, too. That’s huge for our members.”

Power in size
Kuyper says Basin Electric’s size brings opportunity for its members, including Corn Belt Power.

“Basin Electric can take care of billing and everything you have to do with the RTO. They can build a larger facility when resources are needed. And the size of the wind and solar farm projects they’re involved in helps to get better prices than we could,” Kuyper says. “The savings you get by being larger and the expertise of being more specialized in those areas of the market all provide a value.”

Benefit of communication
Wittman says Yellowstone Valley’s service area is growing rapidly, and percentage-wise, they are one of the top electric co-ops for growth in the nation. This is partially because their service area has expanded to cover new subdivisions on the west side of Billings, Montana, which has also diversified their membership.

“We’ve started to serve a lot more residential. We have a lot of very young families and also a lot of retirees,” Wittman says. “But then you balance that with our longstanding grassroots members to the east, and that’s almost all agriculture.” 

Because of the opportunities and challenges with a diverse membership, Yellowstone Valley has started to focus on communication more strongly.

“We’ve embarked on some new things, like doing more advertising, so we can connect with the different demographics we’re serving,” Wittman says. “Basin has been helpful on the communications side, and on several different levels, to help us with this effort.”

Having a voice
The collaboration within the membership is what makes Basin Electric great. Whether a member is a Class A or Class C, each member brings a unique perspective, which is why it’s important that everyone’s voice is heard. 

Yellowstone Valley is a Class C member, and Wittman says he likes the structure and the way Basin Electric views the membership.

“We’re a member of a Class A. You may consider that down a level, but if I have a concern, I feel I can talk with my Class A member, and I know that message gets where it needs to,” Wittman says. “And I can still talk with someone at Basin, no matter what our membership level is. If I need to talk to Dave [Raatz, Basin Electric senior vice president of Asset Management, Resource Planning, and Rates] or Paul [Sukut, Basin Electric general manager and CEO], I’ll just give them a call. Basin is big but it doesn’t feel big. It still feels like a family.” 

Basin Electric answers to its members, who are the cooperative’s owners. That’s why the opinions and recommendations given by members at all levels are taken seriously.

The electric cooperative way
Cooperative culture is something that is best understood by experiencing it firsthand. Member economic participation, cooperation among cooperatives, and democratic member control are just a few of the principles that cooperatives were founded upon. It’s this culture of collaboration that helps meet the unique needs of our members. 

Kuyper says the electrical world keeps changing dramatically, and Wittman shares a similar sentiment about electric co-ops.

“The whole electric co-op network in general is so unique. With the size of Basin Electric and the number of electric co-ops that are members, it would be easy to be a number and be lost in the shuffle, but I don’t feel that way. The structure is set up so I can go to the proper channels to get my thoughts and opinions heard,” Wittman says. “I strongly believe in the cooperative model. It’s just amazing.” 

Basin Electric’s members are its most valuable resource and the reason it exists. As a cooperative, we are all focused on the member at the end of the line. That’s the co-op difference.