As the 2024 election year begins, an already divided Congress may well be struggling to reach consensus on crucial legislation while the Biden administration rushes to issue new federal regulations.

That’s the climate that NRECA’s Government Relations team likely faces as it advocates on behalf of electric cooperatives on Capitol Hill, at the White House and with federal agencies.

In a recent Q&A session, Louis Finkel, NRECA’s senior vice president of Government Relations, talked about how the association will work aggressively to ensure that new bills and regulations help not-for-profit co-ops continue to provide reliable, affordable electricity to their consumer-members.

Electric co-ops have begun winning awards for millions of dollars from the bipartisan infrastructure law and the Inflation Reduction Act, thanks to provisions that NRECA helped secure in those bills. Do you expect the flow of funding to co-ops to continue in a big way this year?

Finkel: First, the biggest issue before Congress this year is going to be funding the government, as it was last year. There is an ongoing tension between the Biden administration, Senate Democrats and House Republicans, with House Republicans wanting to cut funding in the bipartisan infrastructure law and the Inflation Reduction Act.

As we sit here in January, Congress is still working on funding the government for the current fiscal year and then will have to quickly turn to funding for the next fiscal year.

In that context, we continue to educate members of Congress about the value of new incentive programs designed to harden the grid and create greater resiliency in the face of a changing energy environment while looking for opportunities to solidify the reliable, affordable power that electric co-ops offer.

Getting provisions that benefit co-ops into law was really important, but shaping the programs and the guidance that comes out of the federal agencies that implement them has been just as important.

We have been engaged with the agencies to make sure that misguided agency interpretation does not undermine these programs and that they are implemented in the way that Congress intended them to be.

Congress is continuing to try to craft a new five-year Farm Bill that could include crucial funding for co-op infrastructure projects, rural economic development and broadband. What are the prospects for its passage this year? And what is NRECA doing to help shape Farm Bill programs that benefit co-ops and their members?

Finkel: Congress extended the current Farm Bill through the end of the year, which bought them some breathing room. There are some broad differences of opinion between the two parties on a range of programs—most of which don’t directly impact our co-ops.

Our intent is to work with members on both sides of the aisle and in both chambers to reinforce the important role that the Rural Utilities Service programs play as a crucial resource for infrastructure and system improvements and routine maintenance—all with a focus of keeping the lights on. Healthy, strong RUS programs are an important resource for co-op communities throughout the country.

What are some of NRECA’s other legislative priorities for 2024?

Finkel: Though we always have policy matters that we raise, oftentimes our message is driven by the congressional agenda, which could be really narrow this year.

We will look for ways to continue to address supply chain difficulties to ensure co-ops can get transformers in a reasonable time frame, and we’ll push Congress to use some government resources to further alleviate supply chain woes.

Congress is set to reauthorize the Water Resources Development Act, and in light of the recent developments in the Pacific Northwest and the administration’s backroom deal to undermine dams on the lower Snake River, we’ll be aggressively engaged to make sure there are no provisions in the bill to breach those dams.

We’ll continue to push for legislation to expedite permitting and alleviate the endless litigation that stifles the construction of infrastructure as well as advocate for transmission policies that allocate costs to those that benefit the most.

And related to broadband, there continues to be noise about changing the nature of the pole attachment exemptions for electric cooperatives, mostly by other participants in the broadband industry. We continue to educate members of Congress about the importance of the Federal Communications Commission exemptions for our members and how our members and our service territories are different.

With the recently installed Democratic majority at the FCC, we’ve seen a lot of proposals come forward, most notably one on net neutrality. NRECA is asking the FCC for targeted compliance exemptions for electric co-ops in any new net neutrality rules. Co-ops support net neutrality and treat all their broadband consumers equally, but excessive, onerous regulation could divert crucial investment away from the communities they serve.

NRECA has strongly opposed the Environmental Protection Agency’s proposed power plant rule as a threat to co-ops’ ability to provide reliable, affordable power. What can we expect to see on this front in 2024?

Finkel: We expect to see a final rule in the spring, and we’ll continue to oppose the rule, which may very well result in litigation. We’ll continue to push back on the EPA’s overreach, which oversteps its statutory authority and hampers co-ops’ ability to provide reliable, affordable power.

We’ll oppose this kind of overreach by any federal agency, whether it’s the EPA or any other agency. We’ll continue to aggressively raise concerns where necessary and embrace proposals where they make sense.

This is obviously a huge election year with both the presidential and congressional elections. Do the elections complicate NRECA’s efforts to achieve its legislative and regulatory priorities?

Finkel: I don’t think it complicates our ability to achieve anything, but it complicates our ability to advance an agenda. With a divided Congress, it is already really hard to legislate, and even more so in an election year.

On the regulatory side, new proposals are unlikely to get finalized within a year. So, most new regulations that get put forward now are just markers for the president to tell voters what is important to his administration.

In that context, we will continue to oppose shortsighted policies and continue to support policies, both in Congress and in regulatory proposals, that serve the interests of our members and their consumer-members.

Erin Kelly is a staff writer for NRECA.

Read a new op-ed by NRECA CEO Jim Matheson, published by Fox News on Jan. 5, outlining how our national energy policy is threatening reliable, affordable electricity, and America’s economy as a result: Our Broken Energy Policy Could Leave Americans in the Dark

Matheson also recently joined Bret Baier at Fox News on “Special Report” to discuss the importance of keeping the lights on amid rising demand for electricity. He addressed topics such as new electric vehicle infrastructure and hyperscale data centers along with the growing significance of microgrids in enhancing power resilience. View the highlights below:

Members of Congress, electric cooperative leaders and energy analysts warned Wednesday that escalating demand for electricity is threatening to outpace supply as the federal government pushes to accelerate the transition to cleaner energy.

“We’re using more and more electricity,” said NRECA CEO Jim Matheson, citing increased demand for power from data centers, artificial intelligence and manufacturers.

“It’s a good news story in terms of the economy growing,” he said at a POLITICO event sponsored by NRECA on the future of grid reliability. “The question is just how is the electric grid going to keep up and meet that growth?”

Members of Congress from both political parties agreed that America needs to dramatically step up its electricity generation, which they said can only be done if lawmakers make it easier for electric co-ops and other utilities to get permits to expand their systems.

“We need to build a boatload of transmission in the next few decades—200,000 miles of transmission,” said Rep. Scott Peters, D-Calif.

Without those new transmission lines, renewable energy sources such as solar and wind won’t have anything to hook up to, said Peters, who serves on the House Energy and Commerce Committee.

Peters and fellow committee member Rep. Bob Latta, R-Ohio, said they support bipartisan efforts to streamline the federal permitting process so that utilities can get quicker approvals from agencies to build new infrastructure. They also want to limit how long legal challenges to federal permitting decisions can drag on.

“We have to make everything move faster,” Peters said.

Latta said there are 85,000 manufacturing jobs in his congressional district that depend on reliable power from a broad mix of sources, including nuclear.

“If we don’t have affordable power, the companies can’t compete, but most importantly they can’t provide the jobs for all those people across northern Ohio,” Latta said.

Matheson said the power supply problem would be exacerbated by the Environmental Protection Agency’s proposed power plant rule, which seeks to eliminate carbon emissions by mandating the use of new technology in new and existing coal and natural gas generating facilities. 

“This proposed rule has a couple of fundamental flaws,” Matheson said. “First, we believe the proposed rule exceeds EPA’s authority under the Clean Air Act.  Second, the proposed rule mandates the use of two technologies that aren’t ready for prime time.

“You’d either have to use carbon capture and sequestration or you’d have to use hydrogen and you’d have to be ready to do that by 2031, which is not that far away when it comes to planning and investments in infrastructure in the electric sector. So how do we get there when these technologies aren’t even ready?”

He said the rule would mean “less electricity, more power outages and higher expense.”

“That’s not what we should be doing,” he said.

Heather Teilhet, senior vice president of external affairs at Oglethorpe Power Corp. in Georgia, said the proposed EPA rule could affect the affordability of electricity for the generation and transmission cooperative’s 38 distribution co-op members, which serve some of the poorest counties in the state.

“When there is an increase in the cost of energy, we have nowhere else to turn to pay for that increase except our 38 co-ops, and they have nowhere else to turn except to pass that on to the rural families and businesses that are in their service territory,” she said. “We have a unique perspective in looking at this through the eyes of a cooperative.”

Erin Kelly is a staff writer at NRECA.

Americans face dangerous, economically disruptive power outages if the nation can’t overcome threats to reliable electricity, the CEO of a South Carolina electric cooperative warned a House panel Wednesday.

“Simply put, if we fail to act on these reliability challenges, we will struggle to keep up,” Bob Paulling, CEO of Lexington-based Mid-Carolina Electric Cooperative, told the House Energy and Commerce Subcommittee on Energy, Climate and Grid Security at a hearing on reliability.

“Blackouts will become a routine part of our lives, and jobs and industry will flee not only South Carolina, but the country.”

South Carolina faced rolling blackouts last December as unusually cold temperatures pushed the demand for electricity to record highs, straining power grids and leaving hundreds of thousands of consumers without heat, Paulling said.

“Fortunately for Mid-Carolina Electric members, there were no rolling blackouts at our co-op,” he said. “But we may not be so lucky the next time.”

Paulling reinforced NRECA’s message on the five biggest challenges threatening reliability: the increasing electrification of the economy; the disorderly retirement of power plants that run on fossil fuel; a permitting process that costs too much and takes too long; supply chain delays; and problems obtaining natural gas.

South Carolina has been a leader in helping to electrify the U.S. economy, bringing in a host of economic development projects tied to the production of electric vehicles, Paulling said.

“Those projects have brought thousands of high-paying jobs to our state, including to rural, economically depressed areas that have waited decades for this kind of opportunity,” he said. “But these plants also require large amounts of electricity, and we must be ready to serve them.”

South Carolina desperately needs more electricity and more options for producing it as the nation’s third-fastest-growing state works to meet the skyrocketing demand for power, Paulling said.

“In addition to building new power plants, we also need to preserve the existing generation fleet, no matter the fuel source, until adequate replacements and reserves are in place,” he said.

The permitting process for electric co-ops to obtain federal approval for infrastructure projects also must be streamlined, Paulling said.

“A good example of permitting issues unnecessarily prolonging needed improvements in South Carolina is Central Electric Power Cooperative’s attempts to upgrade overloaded infrastructure in the areas surrounding the town of McClellanville,” he said.

“Efforts by the local distribution cooperative and Central to build a needed new transmission line has stalled for nearly two decades in part due to the complicated federal regulatory process and the lack of required coordination and streamlining among federal agencies.”

The international supply chain delays that began during the COVID-19 pandemic are continuing to stall badly needed improvements at electric co-ops, he said.

“At Mid-Carolina Electric, we have been trying to build one single substation for over two years,” Paulling said. “We needed it to be energized this past summer to relieve another substation that is at maximum capacity. We are still waiting on the high-side breakers for that station, and the delivery dates keep changing. We hope to have it energized before the winter peak.”

The availability of natural gas for power plants has been threatened by extreme weather events such as the frigid temperatures across South Carolina last December, he said. More than a quarter of the state’s power comes from natural gas.

“The sick and the elderly cannot be made to endure days of intense South Carolina heat without air conditioning or nights of extreme cold without heating,” Paulling said. “As Winter Storm Uri in Texas taught us just two years ago, people will die if we can’t reliably deliver the electricity they need.”

Erin Kelly is a staff writer for NRECA.

Electric cooperatives will soon benefit from streamlined reviews of their infrastructure projects under the National Environmental Policy Act, thanks to changes in the law pushed by NRECA and approved by Congress as part of a bipartisan agreement to raise the nation’s debt limit.

In a major victory for electric co-ops, the process will now be expedited so that environmental impact statements must be done within two years and less intensive environmental assessments must be completed within a year.

Co-op leaders also will have new opportunities to engage directly with federal officials as part of the environmental review of their projects.

“As our nation increasingly relies on electricity to power more of the economy and threats to reliability mount, it is critical that we permit, build and maintain a robust electric grid,” said NRECA CEO Jim Matheson. “These permitting reforms are an important step forward that will help electric co-ops meet future energy needs while maintaining affordability and reliability.”

Co-ops must undergo NEPA reviews when they seek permits to build major new energy projects. In some cases, they also are required to go through the permitting process when they apply for Rural Utilities Service loans to expand, upgrade and modernize their systems or to remove vegetation that is threatening power lines on federal land.

In February, John Carr, vice president of strategic growth at Dairyland Power Cooperative in Wisconsin, told the House Natural Resources Committee that the federal environmental review process takes too long, costs too much and makes it more difficult for electric cooperatives to provide reliable, affordable power to their members.

“Dairyland and other electric co-ops support the appropriate consideration of potential environmental impacts of energy projects during the permitting process, but the existing process impedes our ability to deploy clean energy to meet the current and future needs of our consumers and communities,” Carr testified.

That message has been reinforced by other co-ops and NRECA leaders who have pressed Congress to take action on permitting reform. It was one of the main issues that co-op leaders brought to their lawmakers’ attention during NRECA’s Legislative Conference in April.

The reforms passed by Congress also mandate that if one agency develops a “categorical exclusion” from certain rules for a specific type of project, another agency can use that same exclusion. The changes also create an expedited permitting process for large energy storage projects.

The House approved the permitting reform provisions as part of the debt limit deal on May 31. The Senate approved the package on Thursday, and President Joe Biden signed it into law on Saturday.

Erin Kelly is a staff writer for NRECA.

The push to rapidly replace always-available energy sources could spark rolling blackouts across America, the leader of a Midwest generation and transmission cooperative warned a Senate panel Thursday.

“Lawmakers must support policies that include all energy sources to maintain reliability and affordability. Rolling blackouts cannot become the new normal,” David Tudor, CEO of Springfield, Missouri-based Associated Electric Cooperative Inc., told the Senate Energy and Natural Resources Committee at a hearing on electric system reliability.

“It is critical that policymakers recognize the need for adequate time, technology development and new transmission infrastructure before taking our nation down an energy path that prioritizes speed over successfully keeping the lights on.”

Tudor cited the North American Electric Reliability Corp.’s recent Summer Reliability Assessment, which warned that two-thirds of the U.S. could face energy shortfalls during periods of extreme heat this summer.

“Importantly, the 2023 NERC summer reliability assessment is just the latest in a series of alarming reminders about the new electric reliability challenges facing the nation,” Tudor said.

“Last month, Federal Energy Regulatory Commissioner Mark Christie warned this committee of threats to reliable electricity, stating ‘I think the United States is heading for a very catastrophic situation in terms of reliability.’”

Associated Electric Cooperative, which serves 935,000 meters across rural Missouri, northeast Oklahoma and southeast Iowa, was able to keep the lights on during severe winter storms the past two years that knocked out power to millions of Americans and led to the deaths of more than 700 people in Texas during Winter Storm Uri in February 2021.

“Associated relies on a balanced generation mix, with proven and reliable coal and natural gas generating plants as a valuable foundation for reliability and dispatched its units to full capacity in advance of the cold temperatures,” Tudor said, describing the co-op’s response to Winter Storm Uri.

“Despite significant outside pressure in recent years to move to other options, these fossil-fuel generating stations were the major factor in keeping the lights on for the 2.1 million people we serve. Hydropower allocated by the Southwestern Power Administration was a reliable energy source. Wind generation in Associated’s mix played a minor role.”

Last December, nine states experienced rolling blackouts as the demand for electricity exceeded supply during Winter Storm Elliott.

“Again, coal and natural gas generation carried the day, preserving reliability for Associated’s members when they needed power the most,” Tudor said.

He applauded the inclusion of some permitting reform provisions in the debt limit deal reached by President Joe Biden and House Speaker Kevin McCarthy, R-Calif. The House approved the deal Wednesday and the Senate approved it late Thursday.

NRECA has made permitting reform a top priority, as the lengthy and costly process for obtaining a federal environmental permit can derail crucial projects to improve service to co-op consumer-members.

“These reforms, including firm time limits for environmental reviews, greater applicant involvement in the process and more efficient reviews for recurring small projects we already know have minimal environmental impacts, will allow co-ops to build new generation and transmission infrastructure in a timely and cost-effective way,” Tudor said.

Erin Kelly is a staff writer for NRECA.

Congress must modernize the federal permitting process to allow electric cooperatives to build new transmission and generation capacity more quickly and cost-effectively to meet growing demand for electricity, NRECA CEO Jim Matheson said in a letter to Senate leaders.

The Senate is working on crafting legislation to address permitting reform, and Matheson’s letter is the latest effort by NRECA to push for improvements that will benefit co-ops and their consumer-members.

“On behalf of America’s Electric Cooperatives, thank you for your efforts to streamline the federal infrastructure permitting process,” Matheson wrote in a May 8 letter to Senate Majority Leader Chuck Schumer, D-N.Y., and Senate Minority Leader Mitch McConnell, R-Ky.

“As we strive to meet our consumer-members’ expectations in the coming years, while maintaining reliable and affordable electric service, electric cooperatives will need to build significant amounts of new electric transmission and generation capacity of all types.”

Many of those projects will require permits and environmental reviews from federal, state and local governments, he said. Major projects will need to complete an environmental impact statement under the requirements of the National Environmental Policy Act.

“Unfortunately, as just one indicator of the headwinds we currently face, it takes an average of 4.5 years to complete an EIS and issue a permitting decision,” Matheson said. “One quarter of EISs take more than 6 years.”

He urged senators to consider five key principles as they conduct hearings and draft legislation to improve the permitting process:

• Time limits of no more than two years for environmental reviews. “That should be enough time to conduct a rigorous review while providing project certainty.”

• Greater applicant involvement in the process. Member-owned co-ops “know the specific details of their projects and the unique needs and challenges facing their communities.”

• More efficient reviews for recurring small projects—such as trimming trees to prevent power outages and wildfires—that are known to have minimal environmental impacts. “Electric co-ops should not have to navigate a lengthy, bureaucratic process for actions where both co-ops and the agency already know the benefits are high and the impacts are low.”

• Limit lengthy, costly litigation that can delay projects indefinitely. “Litigation can result in excessive paperwork and unnecessary delays—holding up projects that communities badly need.”

• Ensure that transmission permitting and siting improvements reflect co-op and community needs. “The electric grid needs more electric grid transmission capacity to meet expected growth in the coming decades.”

Matheson said policies to spur additional capacity must not expand the Federal Energy Regulatory Commission’s authority over electric co-ops. He added that those policies must allocate the costs only to those who receive tangible and quantifiable benefits and “must ultimately serve the national interest of maintaining the reliability and affordability of the electric grid.”

Erin Kelly is a staff writer for NRECA.

NRECA urged Congress to reform federal permitting rules before billions of federal dollars become available for rural broadband and to reject for-profit internet providers’ calls to place electric cooperative poles under federal rate regulations.

In testimony April 19 to the House Energy and Commerce Subcommittee on Communications and Technology, Louis Finkel, NRECA senior vice president for Government Relations, said the federal permitting process “takes too long, is too expensive, and is an impediment to the ability of broadband providers to meet the needs of their consumers and communities.”

More than 200 electric co-ops in 39 states are currently delivering or partnering to deliver broadband to their members.

With the $42.5 billion Broadband Equity, Access and Deployment Program and billions more in other funding coming available to close the digital divide, the hearing examined more than 30 proposals that focus on federal, state and local government barriers to rural broadband, such as permitting and reviews. It also touched on attaching communications equipment to utility poles.

To make the most of these once-in-a generation funds, Finkel said, “this process must be modernized to give more certainty and predictability as electric cooperatives and other internet service providers build networks to connect homes and businesses in rural areas.”

National Environmental Policy Act regulations, for instance, “present a significant challenge to rapid broadband deployment” because even co-ops with existing electric rights of way “must renegotiate…agreements with each state or federal agency, local jurisdiction, or private landowner, which can take years and can cost millions of dollars,” Finkel said.

Finkel also told lawmakers that federal agencies must ensure the accuracy of broadband coverage maps before BEAD funds are released to providers to deploy broadband in unserved areas. “Congress must provide flexibility for states to use their own maps and local knowledge in addition to the new FCC maps when determining eligible locations for BEAD,” he said.

On pole attachments, Congress should reject proposals to require the Federal Communications Commission regulated rate be used for access to co-op poles, Finkel said. He dismissed claims of unfair co-op pole attachment rates and explained that co-ops lease excess space on their poles to third parties, or even their own broadband subsidiary, “for a small fraction of the costs that co-ops have incurred to build and maintain these systems.”

“The fees charged to attach to co-op poles reflect the unique geographic and demographic characteristics of each co-op’s service territories, which can vary from state to state and co-op to co-op.”

NRECA, joined by American Public Power Association and the Utilities Technology Council, sent a letter to the House Energy and Commerce Committee leadership on why nonprofit electric utilities should maintain their 1978 exemption from FCC rate regulations on pole attachments. Proposed legislation would effectively ask these utilities and their customers “to subsidize for-profit companies’ infrastructure buildout,” they said.

“Congress has repeatedly recognized that federal pole attachment regulation is unnecessary for public power and electric cooperative pole owners, because they are owned by their customers, the same customers that would benefit from communications services provided over the facilities attached to their poles,” NRECA, APPA and UTC wrote the committee April 18.

“Modifying or eliminating the exemption will not result in any significant increases in broadband deployment, adoption, and use. Instead, it will merely result in not-for-profit electric utility customers subsidizing for-profit telecommunications and cable companies.”

Cathy Cash is a staff writer for NRECA.

New interim guidance for federal agencies when assessing the impact of greenhouse gas emissions goes beyond the authority of the National Environmental Policy Act and stands to delay critical electric infrastructure projects for small, rural communities.

That’s the message from NRECA and the American Public Power Association to the White House Council on Environmental Quality regarding its Interim Guidance on Consideration of Greenhouse Gas Emissions and Climate Change.

In formal comments filed April 10, NRECA and APPA said the interim guidance for NEPA reviews is overbroad and urged CEQ to withdraw and revise the document.

Construction and maintenance of infrastructure for electric generation, transmission and distribution, and broadband often involve obtaining permits, financing and right-of-way authorizations from federal agencies that must review these projects under NEPA.

“Allowing the guidance to stand would result in further delays and higher costs for NEPA reviews as federal agencies struggle to follow CEQ’s directions, which are unmanageable and inconsistent with the statute and Supreme Court case law,” said Viktoria Seale, NRECA regulatory affairs director. “NEPA is a procedural statute that does not provide authority to change a project’s purpose or alter an agency’s duties or obligations under its statutory authorities.”

The guidance fails to provide sufficient direction to regulatory agencies on when they can determine a project will not have a significant impact on the environment, Seale said. It also favors renewable projects, she said, by presupposing they require less analysis than other work to improve the efficiency and reliability of the electric grid.

At the very least, Seale said, NRECA and APPA recommend that the guidance not be applied to ongoing NEPA reviews that have already passed the scoping stage.

The associations highlighted the innovative energy projects taken on by electric co-ops and public power authorities that reduce greenhouse gas emissions. These include adding more renewable energy, exploring energy storage, greater efficiency and research in carbon capture technologies.

CEQ issued the interim guidance in January and will review public comments to determine whether to revise or finalize the guidance later this year.

Cathy Cash is a staff writer for NRECA.

More than 2,000 electric cooperative leaders are gathering in Washington D.C., for NRECA’s Legislative Conference, and they will urge Congress and federal agencies to focus on maintaining reliable electricity for the American people, NRECA CEO Jim Matheson said at a media teleconference Thursday.

“Affordable and reliable electricity is an issue of growing concern among members of NRECA,” Matheson told reporters ahead of the April 16-19 conference.

“American families and businesses expect the lights to come on whenever they flip the switch, and we’re concerned that the reliability of the grid is at great risk.”

He pointed to rolling blackouts that took place in nine states last December as evidence of “a stressed grid.”

Electric co-op leaders will discuss five major issues that impact reliability with policymakers. They include:

• Growing demand for electricity as other sectors of the economy are electrified.
• Decreasing electricity supply due to the retirement and insufficient replacement of existing generation.
• Supply chain challenges.
• Permitting delays that prevent new electric infrastructure from being built.
• Problems with natural gas availability.

Recent reports by the North American Electric Reliability Corp. underscore the risks to electric reliability, Matheson said. NERC warned last year that the U.S. is experiencing a “disorderly retirement” of older electric generating plants without replacement power coming online fast enough to meet growing demand. NERC’s 2023 summer reliability risk assessment is due out soon.

“Demand is going up and supply is going down, and that’s not a good trend if you want to maintain system reliability,” Matheson said.

In addition to advocating for reliability issues, co-op leaders will push for robust funding for rural broadband and rural development in the new five-year Farm Bill that Congress is considering.

The bill is likely to include funding for the Department of Agriculture’s ReConnect Program, which provides loans and grants to electric co-ops and other groups to provide high-speed internet service to rural communities.

Erin Kelly is a staff writer for NRECA.

More Coverage From Legislative Conference:

Top Policymakers Address Electric Co-op Leaders at NRECA’s Legislative Conference
What Electric Co-ops Need From Policymakers to Close the Digital Divide
Rep. Bob Latta: Rural Connectivity ‘Is Everybody’s Issue’

ARLINGTON, Va. – National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson today applauded House passage of major energy legislation (H.R. 1), which includes critical permitting modernization provisions supported by electric cooperatives.

The bill includes the BUILDER Act (H.R. 2515) which would expedite environmental reviews under the National Environmental Policy Act (NEPA) and other federal processes.

“As threats to electric reliability mount and our nation increasingly relies on electricity to power more of the economy, it is critical that Congress streamline the process to permit, build and maintain the infrastructure that keeps the lights on across the country,” said Matheson. “Unless these obstacles are addressed, it will continue to be difficult to meet future energy needs while maintaining affordability and reliability.

“This legislation is a meaningful step forward as we work to maintain, improve and expand critical electric infrastructure.”

The BUILDER Act places targeted and reasonable limits on the environmental review of proposed major federal actions under NEPA. It establishes deadlines and other requirements to expedite the environmental review of such actions.

Co-ops must undergo NEPA reviews when they seek permits to build new energy projects and when they want to remove vegetation that is threatening power lines on federal land. They also are required to go through the NEPA process when receiving project funding and financing from the U.S. Department of Agriculture’s (USDA) Rural Utilities Service to expand, upgrade and modernize their systems.

Brent Ridge, CEO of Wisconsin-based Dairyland Power Cooperative, echoed Matheson’s strong support for the BUILDER Act, noting that the federal environmental review process takes too long, costs too much and makes it more difficult for co-ops to provide reliable, affordable power to their members.

“Dairyland strongly supports H.R. 1 and appreciates Congress’ effort to provide a pathway for more coordinated, consistent, and timely agency decision-making,” said Ridge. “It’s critical that we place reasonable parameters around the review process and limit unnecessary litigation. Simply put, NEPA modernization is necessary to advance future clean energy projects that will strengthen our economy and benefit the environment.”

Dairyland is a partner in the Cardinal-Hickory Creek transmission line that will deliver wind energy from the upper Great Plains to the Midwest in southern Wisconsin. The project was approved by federal agencies in winter 2020 but has been significantly delayed with costly litigation by environmental groups challenging the decision. It would deliver enough electricity from over 100 renewable energy projects to power millions of homes—but only if it can be built.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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Electricity gets more essential to modern living every day, but electric cooperative executives are warning that without thoughtful policy decisions, future reliability challenges loom.

Demand for electricity is increasing for transportation, digital communications and other sectors of the economy while reliable baseload generation plants are being retired, NRECA CEO Jim Matheson said in a March 7 media teleconference in Nashville, Tennessee, as co-op leaders gathered for PowerXchange, NRECA’s annual meeting of members.

“We’re either replacing plants with less capacity, no capacity, or replacing them with renewables that are intermittent and not always available,” Matheson said.

Matheson, joined by representatives of distribution co-ops and generation and transmission co-ops, expressed broad concerns for consumers and businesses that rely on uninterrupted and affordable electricity.

“We are seeing capacity constraints across the board while we are in a rapid generation transition in our country,’’ said Chris Jones, CEO of Middle Tennessee Electric Membership Corp., a Murfreesboro-based distribution co-op that serves about 335,000 meters. “The meat and potatoes of our industry will remain affordability and reliability.”

Maintaining that reliability at costs consumers can afford is becoming increasingly challenging as the materials needed to meet production demands for essential components like transformers are diverted for electric vehicles and other new products. Co-ops are also among the utility interests urging federal regulators to consider near-term reliability before implementing standards that could exacerbate shortages of essential components.

“We’re shipping transformers out of stock faster than we can restock,” said Buddy Hasten, CEO of Arkansas Electric Cooperatives Inc. The Little Rock-based statewide cooperative association operates ERMCO, the nation’s leading supplier of transformers for electric cooperatives.

“We’re seeing a two-year lead time on orders for our most common transformers,” said Hasten, adding that before COVID-19-related disruptions, lead times of six to 13 months for large orders were common. “It can take two to three years to deliver large units” needed for substations and large industrial applications, he said.

Co-ops are industry leaders in developing renewable energy projects and research aimed at preserving existing generation resources while reducing their environmental impact. But there is growing concern that the early closure of existing generating assets could lead to shortages and disruptions rivaling those caused by extreme weather events.

“It has to be at a pace that makes sense,” said Suzanne Lane, CEO of Kansas Electric Power Cooperative, a G&T headquartered in Topeka. “Our members are very concerned about reliability.”

Co-ops leaders are also advocating for Congress to streamline the permitting process, as it currently can take a decade or longer under the National Environmental Policy Act process to obtain approvals to fully commission new generation or connect new sources to the transmission grid.

“Two years ought to be enough time to complete any review for siting,” said Matheson, adding that NRECA member co-ops are poised to take advantage of dozens of new federal programs designed to expand energy production or strengthen grid assets. One of those programs is a nearly $10 billion U.S. Department of Agriculture initiative to lower carbon emissions.

In addition to generation and transmission and supply chain issues, co-ops are also tackling cybersecurity and physical infrastructure threats aimed at portions of the grid under direct co-op control. That includes nearly 3 million miles of distribution lines and about 17,000 substations.

“Every utility in America is going through that right now,” Matheson said.

Derrill Holly is a staff writer for NRECA.

The federal environmental review process takes too long, costs too much and makes it more difficult for electric cooperatives to provide reliable, affordable power to their members, a Dairyland Power Cooperative leader told a House committee Tuesday.

“Electric cooperatives like Dairyland play a leading role in the ongoing transformation of the electric sector and often need to obtain permits or other authorizations from federal agencies to construct and maintain electric generation, transmission and distribution infrastructure,” John Carr, vice president of strategic growth at the Wisconsin-based generation and transmission co-op, told members of the House Natural Resources Committee.

“Dairyland and other electric co-ops support the appropriate consideration of potential environmental impacts of energy projects during the permitting process, but the existing process impedes our ability to deploy clean energy to meet the current and future needs of our consumers and communities. We simply must reform the process to enable the transition that is already underway and to ensure it can be done reliably and affordably for our customers.”

Co-ops must undergo National Environment Policy Act reviews when they seek permits to build new energy projects and when they want to remove vegetation that is threatening power lines on federal land. They also are required to go through the permitting process when they apply for Rural Utilities Service loans to expand, upgrade and modernize their systems.

“As Dairyland Power has experienced firsthand, lengthy NEPA reviews and litigation delay the completion of critical infrastructure projects, require significantly more time and resources, and have a direct negative impact on communities served by these projects,” Carr said.

The co-op’s efforts to build a transmission line that would cross a federal wildlife refuge to deliver wind energy from the upper Great Plains to southern Wisconsin has been delayed for more than three years because of litigation. It was approved by federal agencies in January 2020 but has been tied up in court by environmental groups challenging the decision.

“There are currently over 100 renewable generation projects depending upon the construction of the Cardinal-Hickory Creek transmission line,” Carr said. “These projects will generate enough electricity to power millions of homes with clean energy. But only if the line can be completed.”

He recommended four priorities for lawmakers as they look to reform permitting processes:

• Establish firm parameters for environmental reviews, including how long the reviews should take.
• Promote greater involvement by co-ops and other permit applicants in the process while still giving federal agencies the final word.
• Ensure faster, more efficient reviews for projects that clearly have minimal environmental impact.
• Limit unnecessary litigation of NEPA reviews. Put time limits on how long someone can wait before filing a lawsuit against a federal agency after the agency grants a permit.

Carr called on lawmakers to support the BUILDER Act, which contains many of those recommendations. The bill’s chief sponsor is Rep. Garret Graves, R-La.

“Meeting current and future energy needs is a major challenge,” he said. “Rising to meet this challenge will require collaboration, creativity and flexibility. Dairyland and our electric co-op brethren are ready to work with all of you and your colleagues in Congress and your federal agency partners to meet these needs.”

Erin Kelly is a staff writer for NRECA.

Electric cooperative leaders urged Congress to pass federal permitting reform legislation, warning that delays in approving projects to modernize electric power systems could threaten grid reliability.

“We’re looking at a significant electrification of the U.S. economy in transportation and other sectors,” NRECA CEO Jim Matheson told reporters Thursday at a media teleconference. “Is our electric infrastructure ready for that?”

To build or upgrade generation, transmission and distribution systems, co-ops must seek permits from federal agencies under the National Environmental Policy Act. But those approvals can take years to obtain and are often further delayed when groups sue the agencies that issue the permits, Matheson said.

“Everyone, even organizations that don’t always agree on a lot, recognizes the need for a more timely and predictable process in this transition to a much more electrified economy,” he said.

Matt Hanson, CEO of 4,600-member McKenzie Electric Cooperative in Watford City, North Dakota, said his co-op has had trouble bringing electricity to tribal members on the Fort Berthold Reservation because of lengthy delays getting permits from the Bureau of Indian Affairs.

“It prevents economic development on the reservation,” he said. “And it impacts the environment. Our consumers there are running their power off generators until we can connect them to lines. It costs 30% to 50% more to connect homes on BIA-governed land.”

Brent Ridge, president and CEO of Dairyland Power Cooperative in Wisconsin, said the delays in federal permitting are making it tougher for the large generation and transmission co-op to reduce carbon dioxide emissions as quickly as it would like. The co-op’s goal is to use 40% renewable power by 2035.

Two separate energy projects—one to deliver wind power and another to build a natural-gas plant that would reduce the use of coal—have been stalled by litigation and other permitting delays, Ridge said.

“If we are to lower carbon emissions as quickly as possible, we need a process that is efficient and nimble,” he said. “The current process is delaying progress and raising costs.”

Ridge, Hanson and Matheson all urged Congress to support the BUILDER Act. The legislation, sponsored by Rep. Garret Graves, R-La., would limit how long various environmental reviews must take, encourage greater involvement by co-ops and other permit applicants in the process and create deadlines for filing lawsuits after permits have been granted.

Matheson said he thought it was encouraging that the House Natural Resources Committee was focusing on the legislation at a Feb. 28 hearing, which includes testimony from Dairyland Power Vice President of Strategic Growth John Carr.

“I think the bill is a good first step,” he said. “I hope there’s a full-fledged bipartisan discussion in Congress. NRECA would certainly support that. We hope to build some momentum going forward.”

Erin Kelly is a staff writer for NRECA.

ARLINGTON, Va. – As President Biden prepares to deliver his State of the Union address later today, National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson urged policymakers to pave the way to a brighter energy future by maintaining a core focus on affordability and reliability.

“The decisions we make today are critical to determining whether there are sufficient resources to meet tomorrow’s energy needs. Above all, American families and businesses expect an electric system that is reliable and affordable. It is crucial that policymakers approach national energy policy with this fundamental expectation in mind,” said Matheson.

“As we continue to electrify the economy, the electric grid will continue to be even more important and all the more stressed. Mapping our energy future will require technology innovation, a modernized system to move power from where it’s produced to where it’s used, and time to accomplish new investments in an orderly fashion. Failure is not an acceptable option for the American families and businesses we serve.”

Electric cooperatives remain focused on working toward meaningful solutions to address reliability challenges spreading across the nation. This includes pressing for substantive action to reform the process for permitting and siting new electric generation and transmission infrastructure.

At the same time, NRECA is advocating for the U.S. Department of Agriculture to fully utilize $9.7 billion in new funding specifically for electric co-ops to implement energy innovation technologies.  Electric co-ops are prepared to make significant investments in carbon capture, renewable energy production, energy storage, nuclear technologies, and electric generation and transmission efficiency.  However, restrictions or limitations on the program would significantly hinder deployment of the funds.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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NRECA is diving into 2023 with a long list of policy goals that range from shaping a new five-year Farm Bill to helping electric cooperatives prepare for catastrophic wildfires.

“All of our priorities are aimed at helping our members maintain reliable and affordable power and giving them tools to help meet the challenges of the future,” said Hill Thomas, NRECA’s vice president of legislative affairs.

Thomas and Ashley Slater, NRECA’s vice president of regulatory affairs, said their teams will work closely together to help pass legislation that benefits co-ops and then ensure that those new laws are implemented as intended.

Co-ops saw major policy wins in 2021 and 2022 with passage of the bipartisan infrastructure law and key co-op provisions in the Inflation Reduction Act, and NRECA will continue its efforts this year to ensure that members benefit fully from the programs created by those laws.

In a recent Q&A session, Thomas and Slater outlined what’s ahead for co-op policy goals.

What are NRECA’s top regulatory priorities for 2023?

Slater: I have a long list!

• Implementing NRECA’s two priority provisions in the Inflation Reduction Act: direct-pay energy tax credits and the $9.7 billion U.S. Department of Agriculture program to assist co-ops with the energy transition.

• Shaping agency funding opportunity announcements for co-op programs included in the $1.2 trillion bipartisan infrastructure law. Those programs include rural broadband, electric vehicle programs to build a network of chargers, grid resiliency and modernization, physical security and cybersecurity, and clean energy programs.

• Protecting co-op access to an affordable, reliable power supply as the Environmental Protection Agency looks to regulate greenhouse gas emissions and air pollutants.

• Ensuring sound transmission policy as the Federal Energy Regulatory Commission contemplates first-in-a-decade transmission reform.

• Ensuring that the Department of Energy uses its presidentially directed Defense Production Act authority appropriately to ease supply chain shortages.

• Ensuring that any new cybersecurity or physical security reporting requirements by the Department of Homeland Security are optimized for co-ops to enhance their security posture and improve their ability to protect against, detect and respond to—or recover from—threats to the electric system.

• Modernizing environmental permitting. The existing processes take too long, are too expensive and are an impediment to co-ops’ ability to meet future energy needs. They need to be modernized to give more certainty in the energy transition.

• Working with co-ops to prepare for and respond to catastrophic wildfires. Co-ops that want to do vegetation management are running into inconsistent guidance from the Bureau of Land Management and the Forest Service. We need to work with the agencies to streamline the process.

• Working with co-ops to ensure that the broadband maps produced by the Federal Communications Commission are done correctly to provide the best picture of where broadband is and isn’t available across the country. The FCC has released a pre-production draft of its latest broadband maps.

What are NRECA’s top legislative priorities for 2023?

Thomas: For the first couple of months, our top priority will be holding Co-op 101 sessions to meet the 81 new members of Congress and educate them about electric cooperatives. Beyond that, we want to make sure Congress is engaged when they need to be to ensure the legislation that has already passed is implemented the right way to benefit co-ops and their members.

A new five-year Farm Bill is being written by Congress that will affect electric co-ops and all of rural America, so that will be a priority. And we support a bipartisan permitting modernization conversation. Also, we’re going to continue to face supply chain problems, and we’re going to continue to work to solve that.

We’ve already had co-op leaders come and testify to Congress about the upcoming Farm Bill. How will it affect electric co-ops specifically?

Thomas: The Farm Bill is the only piece of legislation that Congress does that is uniquely and specifically aimed at rural America. It is designed to support rural America and we share that goal. It’s important for us to talk about our priorities, including many of the USDA programs that we use such as rural development financing, the home energy efficiency program and clean energy deployment financing. These programs can be reauthorized in the new Farm Bill, and we want to make sure they’re operating as effectively as possible and are good to go for the next five years.

The other big conversation will be about broadband. There’s an opportunity to rewrite and improve the USDA ReConnect broadband program, which has provided opportunities to many of our members but could also operate more efficiently. It’s a fairly new program that has received lots of money, but some of our members haven’t been able to get access to it because it’s just too bureaucratic. We need to streamline the program so we can serve the communities that need it most.

Is the environment in the Biden administration and in Congress, with divided government, conducive to accomplishing NRECA’s goals?

Thomas: On the congressional side, with the House majority and the president being from different parties, it is going to be a tough environment for big, game-changing legislation. But we have a good reputation for being able to bridge gaps and find partnerships and bipartisanship. I think there will be lots of opportunities for us to engage in these important conversations.

Slater: We recognize that resource planning decisions are unique to the needs of the specific co-op and the communities they serve. The administration understands that if they want their policies to have a real impact, they have to reach rural America. And they can’t get there without electric co-ops.

That presents a real opportunity for our members who want to participate. In order to push an energy transition across the country, if you want to get there, you have to go through electric co-ops. If there’s no uptake, you’re not going to be successful in getting these dollars utilized…To the extent that we can be a conduit, that’s our edge.

Erin Kelly is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association CEO Jim Matheson called the North American Electric Reliability Corporation’s latest reliability assessment a “clear and constant warning about the nationwide consequences of continuing a haphazard energy transition.”

“This assessment paints a stark and disheartening picture of the reliability challenges facing much of the United States this winter,” Matheson said. “As the demand for electricity risks outpacing the available supply during peak winter conditions, consumers face an inconceivable but real threat of rolling blackouts. It doesn’t have to be this way. But absent a shift in state and federal energy policy, this is a reality we will face for years to come.

“The pursuit of an energy transition that prioritizes speed over practicality has jeopardized America’s ability to keep the lights on. Today’s energy decisions will determine whether there are sufficient resources for the lights to come on tomorrow. Failure is not an acceptable option for the American families and businesses we serve.”

A recent report from the National Renewable Energy Laboratory concluded that in order to reach the Biden administration’s goal of a zero-carbon grid by 2035, U.S. power generation capacity would have to triple from 2020 levels. Electric transmission infrastructure would need to double or triple as well.

“Electric cooperatives remain focused on working toward meaningful solutions to address reliability challenges spreading across the nation,” Matheson said. “This includes pressing for meaningful action to reform the process for permitting and siting new electric generation and transmission infrastructure.”

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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A resilient, reliable electric grid that provides affordable power is crucial for rural communities as America transitions to cleaner energy, the CEO of an Illinois electric cooperative told a Senate committee Tuesday.

“Diversity of electric generation is essential to our commitment to a lower carbon future,” Mike Casper, president and CEO of Jo-Carroll Energy, told the Senate Agriculture Committee at a hearing on the 2023 Farm Bill.

“As cooperatives look to the future, we are exploring all options, technologies and ideas to work to meet the evolving energy needs of the local communities we serve.”

Casper testified that electric co-ops are facing three key challenges:

• Responding to consumer-members’ desire for a diverse energy mix.
• Maintaining reliable baseload power as part of a lower-carbon future.
• Providing services beyond electrification, including rural broadband.

“Unlike the rest of the electric sector, electric co-ops sell the majority of their power to households rather than businesses,” Casper said. “Keeping rates down for rural families at the end of the line is especially important for JCE.”

The Elizabeth, Illinois-based co-op serves about 26,500 electric and natural gas accounts in four counties and provides high-speed internet service to more than 3,000 subscribers through its broadband division, Casper said.

The distribution co-op gets its power from two generation and transmission co-ops, Dairyland Power Cooperative and Prairie Power Inc., both of which have made substantial investments in renewable energy.

“Dairyland recently completed a large wind power purchase agreement to power 16,000 homes in addition to their current renewable portfolio that makes up over 20% of their generation mix,” Casper said. “Prairie Power is similarly investing in renewable energy through solar farm ownership and power purchase agreements for solar and wind energy.”

Jo-Carroll Energy is supplementing that power by developing three community solar arrays, which resulted from feedback the co-op received from member surveys, Casper said. The U.S. Department of Agriculture’s Rural Energy for America Program provided more than $89,000 in grants to help create one of those solar farms.

A new $9.7 billion USDA program created by Congress this year as part of the Inflation Reduction Act will also help interested co-ops build new clean energy systems by providing grants and loans for projects that include renewable energy, energy storage, carbon capture, nuclear power, and generation and transmission efficiency, Casper said.

“These programs will help co-ops meet the future energy needs of the communities they serve while providing important flexibilities to maintain reliable, affordable power in rural America,” he said.

Electric co-ops rely on funding from USDA’s Rural Utilities Service Electric Program to help pay for essential electrical infrastructure projects, Casper said. But too often, he said, RUS loan approvals are “needlessly lengthened by environmental reviews and decision delays.”

“To meet our nation’s growing electricity needs,” Casper said, “electric cooperatives would benefit greatly from reforms to the federal permitting process that maintain robust environmental protections while ensuring determinations are made in a timely manner.”

Co-ops want to continue to collaborate with Congress to help develop the next Farm Bill, Casper said.

“JCE and the rest of our nation’s electric cooperatives look forward to working together in our shared goal of powering and improving the lives of rural Americans,” he said.

Erin Kelly is a staff writer for NRECA.

ARLINGTON, Va. – The National Rural Electric Cooperative Association (NRECA) today said that President Biden’s “permitting action plan” fails to deliver the necessary reforms to streamline environmental reviews and permitting of electric transmission and other projects to modernize America’s electric infrastructure. Such projects are essential to maintaining the safe, affordable and reliable delivery of electricity across the nation.

“The administration’s plan fails to address the root of the environmental review and permitting problems plaguing the electric sector,” said NRECA CEO Jim Matheson. “As we plan for a future that depends on electricity as the primary energy source for most of the American economy, the streamlined siting and permitting of electric infrastructure projects will be a key success factor. Robust reforms are needed to remove barriers and accelerate the construction of modern energy infrastructure.”

For years, electric cooperatives have encouraged policymakers to support solutions that modernize the National Environmental Policy Act (NEPA) and facilitate coordinated, consistent, and timely agency decision-making. Lack of federal coordination, inconsistent processes, and protracted litigation have forced communities to endure costly project delays, some of which led to project cancelation, and threats to electric reliability.

The 102-mile Cardinal-Hickory Creek Transmission Line Project is one example of the need for significant reforms. Work on the project began in 2014 to bring renewable energy online in the upper Midwest. Nearly 115 renewable energy projects are dependent upon the completion of this transmission line. The project’s timeline was jeopardized after a court ruling blocked it from crossing the Mississippi River, which could significantly delay and drive up the project’s costs.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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