Innovation and The Changing Energy Landscape

Innovation and The Changing Energy Landscape

Innovation is one of East River Electric’s guiding values. Our employees are challenged to think outside the box of current business practices and explore new solutions that will benefit our industry, always looking through the lens of how those solutions can enhance the value of our member systems. The successes of this approach are visible throughout East River’s history, from launching one of the most successful cooperative load management programs in the country to serving as a driving force behind growing our region’s ethanol industry and more.

In 2018, East River partnered with the National Rural Electric Cooperative Association and Dakota State University on an innovative research and development project to help optimize consumers’ energy usage in their homes using smart home technology. The Connected Home Research Project has been testing smart home technology – from a connected refrigerator and washer and dryer to connected lighting and state-of-the-art home appliances. The expected outcome of this project would help homeowners and their electric cooperative save money and improve their lives.

By working together with their neighboring cooperatives, East River’s members are able to be involved in wider-reaching research and development projects in an effort to continue making innovation a top priority and living up to our guiding values.

Our Power Generation Strategy

Our commitment to innovation includes continuously looking to ensure we have a mix of power resources to serve our membership with reliable and affordable electricity. As a result, we employ an ‘all of the above’ generation strategy. Part of that strategy is using renewable energy. Currently, 37 percent of our cooperative family’s generation mix comes from renewable sources including hydropower and wind, with plans for steady and fiscally responsible growth. That includes buying power from what will be South Dakota’s largest solar farm – the 128 megawatt Wild Springs Solar farm – beginning in 2022. This year, about 20 percent of our energy mix comes from wind resources. Looking back about 10 years ago, just 8 percent of our power supply came from wind. Additionally, the percentage of coal in our power supply sales has dropped 15 percent in the past decade, now making up only about 43 percent.

The need for our ‘all of the above’ approach to supply electricity was highlighted during the record-setting cold period in January 2019 when wind towers in the Dakotas had to be shut down. Weather stations installed on each turbine automatically shut down the wind tower when temperatures drop to 22 degrees Fahrenheit below zero, as the extreme cold puts the components of the wind tower at risk of failure. During that time when wind generation had to shut down, Basin Electric Power Cooperative turned to their reliable natural gas and coal generation as well as market purchases to meet our co-op network’s demand for electricity.

We have a watchful eye on the electric system around the clock making sure your lights come on when you flip the switch, from the coldest days of winter to the hottest days of the summer. We change and adapt in ways that limit risk for our members while taking advantage of new developments in energy production.

Saving Energy and Money

Beyond supplying the region with affordable and reliable electricity, East River and our member systems offer a suite of programs to help consumers save energy and money. Our Renewable Energy Credit, or REC, program entered its fourth year in 2020. Through the REC program, local member-owners can purchase RECs to offset their current energy usage with 100 percent renewable energy and showcase their support for current and future renewable projects.

In conjunction with our members, East River offers a robust residential and commercial energy efficiency rebate and loan program. Our energy efficiency incentives reward members for replacing worn out appliances with energy efficient alternatives and for making other efficiency upgrades in their homes and businesses. Since 2010, East River has awarded more than $4 million in energy efficiency incentives.

Our load management program has saved our members more than $250 million in avoided wholesale power costs since it launched in 1985. Load management is a means of controlling the amount of electricity being used during times of peak demand in our service area. Peak demand is the greatest amount of electricity used at one time by an electric system, normally when a large number of customers are using appliances at the same time. These peaks determine how much we must pay for power. When periods of peak demand occur, load management reduces the demand and lowers the cost to all members. Over 75,500 electric loads in homes, farms and businesses of member consumers throughout eastern South Dakota and western Minnesota currently participate in the program. These loads include electric water heaters, air conditioners, irrigation systems and other big energy users.

Innovation has served as a driving value at East River Electric since our cooperative was formed by our member systems nearly 70 years ago. We have worked alongside our member co-ops for decades to provide an affordable and reliable supply of electricity to their member-owners. That’s one thing that will never change. But how we produce and meet the growing demand for electricity has changed considerably, and it will continue to evolve. Electric co-ops have played a leading role in the country’s energy transformation, and we will continue to lead with the aim of meeting members’ needs in a fiscally responsible manner.

Cooperatives work together to provide power, reduce risk

Cooperatives work together to provide power, reduce risk

Our region’s electric cooperatives have always worked together for the benefit of all consumers in our area. When there is growth in one area, all of the other cooperatives pool their resources through their membership in the wholesale electric cooperative they created, East River Electric, to help build the necessary infrastructure to serve a new subdivision, business or ethanol plant. They help with the investment and share in the risk even if it isn’t in their cooperative service territory. These cooperatives know that when a new business comes to their area, their fellow co-ops will be there to help build the infrastructure to serve it through their membership in East River Electric. It’s the co-op way; working together for the benefit of all.

Unfortunately, Dakota Energy Cooperative headquartered in Huron, has made its intention known to break the promise they made to their surrounding cooperatives to share in the risk and reward of working together. Dakota Energy filed a lawsuit in November 2020 against its own cooperative, East River Electric, to break the long-term contract they signed in 2015. They intend to purchase power from a for-profit investment firm which operates as an unregulated power broker called Guzman Energy which has no investment in our region.

In the last 20 years, Dakota Energy Cooperative has tripled the amount of energy they sell annually. Much of that growth has come from just a few larger consumers. All of the other cooperatives, through their ownership in East River Electric, invested in the infrastructure necessary to serve those large businesses. Costs to Dakota Energy alone would’ve been significant, so rather than building their own transmission and substation assets they relied on East River Electric and the other members to build the transmission for them. They signed a long-term contract in 2015 promising to buy power from East River Electric to pay for their share of that infrastructure. Now they’re attempting to break a contract which could lead to increased costs on the other cooperatives that helped them pay for infrastructure they needed.

Electric infrastructure is a capital-intense proposition. Transmission needed to move power from a generation source to a home or business is expensive. If cooperatives didn’t work together to take advantage of economies of scale and spread the risk of investing tens of millions of dollars to serve consumers, local rates would be much higher. East River Electric provides the expertise needed to build and maintain these transmission assets. East River Electric linemen and substation technicians, who are local South Dakotans and Minnesotans, help repair lines after storms. These are examples of how cooperatives have always worked together for the betterment of all.

Basin Electric and West River Solar announce Power Purchase Agreements for South Dakota solar projects

Basin Electric and West River Solar announce Power Purchase Agreements for South Dakota solar projects

FOR IMMEDIATE RELEASE

Media Contact: Joan Dietz, Manager of Communications

Bismarck, N.D. – Two new solar projects in South Dakota will provide another 20 megawatts (MW) of affordable, renewable power to Basin Electric customers.

Basin Electric Power Cooperative (Basin Electric) and West River Solar, announced the execution of a Power Purchase Agreement (PPA) for the West River Solar Project. When completed, the project will consist of two, 10-MW projects in Pennington County, South Dakota, near the Rapid City airport.

Unlike other generation and transmission cooperatives throughout the United States, Basin Electric is experiencing significant load growth within its membership.

“Renewable technology has become more affordable in recent years so we have been able to meet about 80 percent of our growth with renewable energy, as well as market purchases and natural gas energy production,” said Basin Electric CEO and General Manager Paul Sukut. “The West River project is Basin Electric’s third solar PPA and the result of our continuing goal of providing a diverse mix of cost-effective energy for our members.”

Ros Rocco Vrba, president of Energy of Utah, the parent company of West River Solar, said, “We are very proud for this opportunity to develop yet another renewable energy asset in South Dakota with West River Electric Cooperative and Basin Electric.”

“We’re excited that West River’s service area will be home to the West River Solar Project,” said Dick Johnson, CEO and general manager of West River Electric Association, a Basin Electric Class C member headquartered in Wall, South Dakota. “This solar energy project will benefit our cooperative family, as well as our local communities. As not-for-profit co-ops that are owned by our members, everything we do goes back to the people we serve.”

Basin Electric Class A member Rushmore Electric Power Cooperative, headquartered in Rapid City, South Dakota, provides wholesale power to West River Electric and seven other distribution cooperatives in western South Dakota.

“Our cooperative network is always looking to ensure we have a mix of power resources to meet the needs of our membership and renewable energy is an important part of that strategy,” said Vic Simmons, general manager of Rushmore Electric. “The energy from this project will all be used locally in western South Dakota and is an important strategic step as we look to the future in continuing our strong history of providing safe, affordable and reliable power.”

Solar energy in South Dakota received an additional nod when the South Dakota Public Utilities Commission approved a construction permit for the Wild Springs Solar Project last week. Wild Springs, which will also be located in Pennington County, is a 128-megawatt project and was Basin Electric’s first-ever utility-scale PPA for solar power. The project is anticipated to begin operations in 2022.
The West River Solar Projects are scheduled to begin operations in December 2022.

About Basin Electric Power Cooperative
Basin Electric is a consumer-owned, regional cooperative headquartered in Bismarck, North Dakota. It generates and transmits electricity to 140 member rural electric systems in nine states: Colorado, Iowa, Minnesota, Montana, Nebraska, New Mexico, North Dakota, South Dakota, and Wyoming. These member systems distribute electricity to about 3 million consumers. Learn more at www.basinelectric.com.
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