Matheson Urges Congress to Include Co-op Priorities in Spending Bills

NRECA CEO Jim Matheson is urging Congress to include co-op priorities in key spending bills that lawmakers are negotiating. (Photo By: Henryk Sadura/Getty Images)

NRECA CEO Jim Matheson is calling on Congress to include top electric cooperative priorities in key spending legislation this year that, if passed, will affect energy and climate policies.

The House returned from recess this week to consider legislation passed recently by the Senate, including a bipartisan infrastructure bill that includes $550 billion in new spending and a $3.5 trillion budget plan by Democrats that includes climate change initiatives.

“America’s electric cooperatives are focused on a reasonable approach to climate policy and energy supply that prioritizes the reliable, affordable and responsible delivery of electricity to every community,” Matheson wrote in an Aug. 23 letter to congressional leaders.

“As you consider legislation to promote clean energy development, adherence to these priorities will allow electric cooperatives to continue to meet the needs of the communities we serve.”

Specifically, Matheson asked top leaders in the House and Senate to include the bipartisan Flexible Financing for Rural America Act, which would allow co-ops to save more than $10 billion by refinancing their existing Rural Utilities Service debt at current interest rates without facing prepayment penalties. More than 500 co-ops hold outstanding RUS loans through the U.S. Department of Agriculture.

As of Aug. 24, the bill had 186 co-sponsors in the House and 29 in the Senate.

“In the cooperative business structure, those savings would flow directly back into the communities we serve in the form of new infrastructure investments and lower electricity rates,” Matheson wrote.

He also urged Congress to provide direct-pay tax credits to co-ops as incentives for developing clean energy projects, including wind, solar, energy storage, carbon capture and sequestration, and nuclear energy.

“As not-for-profit businesses, electric co-ops have been unable to use energy tax incentives that are available to investor-owned utilities,” Matheson wrote. “This significant disadvantage has, for many years, hindered co-ops’ ability to deploy new technologies.”

He also raised concerns about the inclusion of a clean energy standard in a spending package, warning that it could jeopardize co-ops’ ability to provide reliable, affordable electricity.

“The costs to serve rural America are significantly higher than other electric utilities and a clean energy standard could create a disproportionate burden on millions of low- and moderate-income families and small businesses,” Matheson wrote.

While opposing a burdensome mandate, NRECA supports funding for the Biden administration’s proposal for a voluntary incentive program to assist co-ops in the transition to lower carbon technologies, he said.

“This program—funded at a minimum of $30 billion for grants and loans—would provide financial incentives for carbon-reducing measures such as deployment of low-carbon electricity sources, debt relief for premature closure of fossil fuel generation and community-based energy efficiency programs.”

The letter was sent to House Speaker Nancy Pelosi, D-Calif., House Minority Leader Kevin McCarthy, R-Calif., Senate Majority Leader Chuck Schumer, D-N.Y., and Senate Minority Leader Mitch McConnell, R-Ky.

Erin Kelly is a staff writer for NRECA.