New England colleges form solar buying partnership

A coalition of New England colleges has formed to purchase electricity from a solar farm in Farmington, Maine. The New England College Renewable Partnership describes itself as the first collaborative purchase of solar electricity in New England higher education.

The New England College Renewable Partnership includes Amherst, Bowdoin, Hampshire, Smith and Williams Colleges. According to an announcement by Amherst, Mount Holyoke and UMass Amherst had also participated in earlier discussions about the project, but later abandoned the project, while Bowdoin joined the group. 

The partnership is collaborating to purchase power from a 25-megawatt solar array under development by a subsidiary of NextEra Energy Resources. Its predicted annual output is about 46,000 megawatt-hours, under a 20-year contract.

Each of the participating colleges describes environmental, financial, and educational benefits from the project. For example, the power purchase agreement reportedly requires that all involved colleges and their student bodies be allowed access to the project site and its data. Initial power deliveries are expected in late 2019. The colleges also cite other benefits from the project, including advancement of their sustainability and climate action initiatives.

Interest in cooperative or collaborative procurement of energy products or projects is rising. By collaborating as purchasers of solar energy, the colleges may have achieved some advantages over their options if going alone. The New England College Renewable Partnership cites its model as providing "market access that would not have been available to individual institutions, offering a scalable model that other colleges and universities can follow."Amherst's announcement explained that while each school has small energy demands, by "increasing the number of schools in the partnership, the group was able to raise the total demand for renewable energy."

Will other institutions follow this model of collaborative procurement of renewable energy?

Energy and electricity cooperatives on the rise?

Could energy cooperatives or other alternatives to investor-owned utilities play a larger role in connecting consumers with electricity, heating fuel and other forms of energy? Emerging technologies like microgrids and increased interest in decentralization and local governance could support a growth in consumer-owned utilities or similar cooperative structures.

When used as an adjective, "cooperative" generally means "involving mutual assistance in working toward a common goal."  In its noun form, "cooperative" can mean "a farm, business, or other organization that is owned and run jointly by its members, who share the profits or benefits."  Other definitions arise in the specific contexts of electricity and other forms of energy, but the National Rural Electric Cooperative Association cites seven core principles and values common to all cooperatives: open and voluntary membership; democratic member control; members' economic participation; autonomy and independence; education, training, and information; cooperation among cooperatives; and concern for community.  

Today in the U.S., more than 900 cooperatives in 47 states provide electric service to an estimated 42 million people in 47 states.  According to a trade association, distribution and generation and transmission cooperatives collectively own assets worth $175 billion, invest about $13 billion annually in new plant equipment, and employ 71,000 people in the U.S.  Many cooperatives serve relatively rural areas that were not previously served by other utilities, although some have grown within other utilities' territories.  This local model stands in contrast to investor-owned utilities, many of which are owned by large national or global corporations whose ultimate parent companies are based overseas.

Cooperatives or similar organizations are already part of many sectors of the economy besides electricity, including housing, financial services, agriculture, retail, fisheries, and manufacturing.  Values like local self-determination, inclusion and fair dealing can align well with the cooperative form.  Many states recognize the rights of consumers of various products or services to participate in cooperatives.  For example, a Maine statute allows any 3 or more natural persons to incorporate a consumer cooperative association to "engage in any one or more lawful mode or modes of acquiring, producing, building, operating, manufacturing, furnishing, exchanging or distributing any type or types of property, commodities, goods or services for the primary and mutual benefit of the patrons of the association, or their patrons, if any, as ultimate consumers."  This concept can broadly be applied to electricity, oil, wood, or other forms of energy.

Many states have enacted specific laws adapting electricity generation and distribution to the cooperative model.  For example, Maine law allows the creation of rural electric cooperatives, which are cooperative nonprofit membership corporations established for the purpose of supplying electricity and promoting and extending the use of electricity.  Such a cooperative can have powers including the ability to acquire electric transmission and distribution lines or systems, electric generating plants, dams, or other property determined necessary, convenient or appropriate to accomplish the purpose for which the cooperative is organized.  If it distributes and supplies gas or electric transmission and distribution service, the cooperative may be treated as a public utility under state law.  If another public utility is already furnishing or is authorized to furnish a similar service in or to a municipality, Public Utilities Commission approval would be required before the cooperative may furnish that service.

Cooperatives are already engaged in the utility sector as one form of consumer-owned utility.  Other alternatives to investor-owned utilities exist -- for example, municipal power districts or municipally owned utilities exist in some places such as Massachusetts, or public utility districts in Washington.  Whether under a cooperative or municipal form, these alternatives can be aligned with values like local self-determination and energy sovereignty -- for example, the right to choose one's own mix of energy supply resources, or manage more closely for local values.  In some cases, they can also deliver essential services like heat and power at a lower cost or with improved value (such as enhanced reliability or environmental performance) compared to traditional utility systems.

As communities look to the future, cooperatives or other alternatives to investor-owned utilities may be increasingly attractive by virtue of their alignment with the local interests consuming services like electricity.  If consumers perceive investor-owned utilities as not responsive to consumer needs, the cooperative form could continue to make gains in some areas, for example in the form of energy cooperative microgrids.  The cooperative form has significant potential to continue to expand into the energy sector.