Vital Signs: NRECA's Annual Summary of Distribution Cooperative Data

By Ganley, Mike; Olivier, Dave et al. | Management Quarterly, Winter 2004 | Go to article overview

Vital Signs: NRECA's Annual Summary of Distribution Cooperative Data


Ganley, Mike, Olivier, Dave, Williams, Louise, Management Quarterly


Vital Signs, first produced in 1985, is an annual analysis of the data reported by rural electric systems from the end of the previous calendar year.

This year's data (2003) is based on 605 RUS borrowers and 174 CFC borrowers for a total of 779 rural electric distribution systems. All data is treated confidentially and no individual data is released or published. A more extensive graphical depiction of the trends shown can be found at: http://www.cooperative.com/library/coopfacts/data/vital.htm

AMERICA'S ELECTRIC COOPERATIVE NETWORK

During 2003 electric cooperatives posted an average customer growth rate of 2.2%

HIGH CONSUMER GROWTH WIDESPREAD

The map below shows those areas where cooperatives experienced above average consumer growth (greater than 2%). Co-ops are experiencing high growth in all parts of the country, not just the fast growing regions of the Southeast and West. Retirement migration, recreation activity and the effect of metropolitan areas spreading farther and farther from their cores have brought many new consumers to co-op areas

COOPERATIVES LEAD INDUSTRV IN CONSUMER GROWTH

Rural electric distribution co-ops added over 300,000 new customers (meters) in 2003. This translates into 800,000 additional people served by cooperatives. Consumer growth of co-ops usually outpaces that of the industry as a whole and that was true again in 2003.

STRONGEST SALES GROWTH

The map below shows the co-ops that had sales growth of 3% or more. The southwest recorded its warmest year ever and suffered through severe drought from September to December. Co-ops in this area experienced high sales. The east had a relatively cool year with record precipitation.

SALES DECREASED FROM PREVIOUS YEAR

Weak sales growth and sales decreases across the country are a result of many co-ops coming off of a very high sales growth year. Many of the decreases are located in areas where temperatures returned to levels near normal and areas that dealt with cooler than normal summers.

LOWEST USAGE

Low electricity usage may be due to less need for air conditioning in the summer or electric heat in the winter (availability of natural gas and other fuels). Less affluent households also tend to use less electricity, as do areas with mostly seasonal sales.

[ILLUSTRATION OMITTED]

AVERAGE RATES BY CUSTOMER CLASS

Average co-op rates (revenue per kWh in cents) are shown below
for each class of service, Residential sales comprise nearly 60% of a
co-op's total sales, whereas other utilities sell more than 60% of
their power to commercial and industrial consumers.

cent/kWh

Total           7.1 cents
Residential     8.0 cents
Commercial      7.4 cents
Industrial      4.3 cents

Source: 2003 Form 7 data for 779 distribution co-ops (average)

Note: Table made from bar graph.

AVERAGE RESIDENTIAL USAGE

Electricity usage is much higher for co-ops than for other utilities
because alternative heating fuels are often unavailable in rural areas.

kWh

IOU                 829
Municipal           917
Co-op             1,126

Source: 2003 Form 7 data for 779 distribution co-ops
And 2003 EIA data for IOUs and Municipals (average)

Note: Table made from bar graph.

COSTS FOR THE TYPICAL DISTRIBUTION COOPERATIVE

The cost of purchased power typically represents two-thirds of a
distribution co-op's total costs. Distribution costs make up the other
third.

Distribution Costs

Cost of Power           65%
Overhead                10%
O&M                     10%
Capital Cost            13%
Margins                  2%

Source: 2003 Form 7 data
For 779 distribution co-ops
(average)

Note: Table made from pie chart.

POWER COSTS RISING

Power Costs generally declined during the 1990s but have been
rising recently with the increased cost of coal, natural gas and fuel
oil.

Power costs rose 6% in 2003. … 

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