September 2016

REPORT

MREA ENERGY ISSUES SUMMIT OFFERED VARIETY OF PERSPECTIVES

Based upon member feedback, MREA’s 21st annual Energy Issues Summit was another remarkable educational gathering

for Minnesota’s electric co-op members. We explored some different angles this year by focusing on economic development and how co-ops can contribute to prospering their communities.

Through panels directly focusing on growing rural economies and communities, we encouraged co-op leaders to coordinate and strategize about how they can prosper their own communities through economic and community development. The hope is that this ignited some action and passion among the already engaged co-op leaders, and that members at least took home a connection to someone or some idea that is an actionable nugget they can utilize or implement in their communities back home.

Member favorites were speakers who offered provocative conversation, differing viewpoints, a focus on new technologies and ways co-op leaders can recognize the trends that are transforming energy.

• Futurist Simon Anderson talked about seven transformational trends. Do you think your co-op will ever use virtual reality? Probably not like this virtual reality on the YouTube video titled, “Grandma Tries Virtual Reality for the First Time.” https://goo.gl/1udfmq

• Industry business devel-opment expert Steve Collier outlined the ac- celerating movement away from a traditional utility model and toward an evolutionary model and why “business as usual” at your co-op is dangerous.

• CFC CEO Sheldon Petersen looked at finan- cial trends and strategies co-ops need, to stay strong for members as we face declining sales. He cited Minnesota solar trends as one of the contributing flat liners with Minnesota having 143 solar companies operating in the state, and 2015 seeing 116% annual growth of installed solar capacity. Over the next five years, Sheldon told us, that SEIA predicts Minnesota will add 1,164 MW of solar capacity.

In addition, key to your success is being informed and out ahead of political trends and their impact on energy. Minnesota House Speaker Kurt Daudt gave us his impressions of the environment at the Minnesota State Capitol. Also, as EIS’ most popular presenter, national political analyst David Wasserman with the Cook Political Report gave us a thorough rundown on the outlook of the national election and how the growing culture gap in our nation is impacting how we vote.

We hope you were able to make it and found topics that challenged and educated you.

Check out more photos in the EIS photo album on MREA’s Facebook at https://goo.gl/t7RBoK.

by Alison Deelstra, Director of Education and Communication

Simon Anderson

David WassermanSteve Collier

Sheldon Petersen

Rep. Kurt Daudt

I grew up up in a family of six kids, two parents and three pets. When

we moved out of the house, my dad always stressed to us kids to let them know where we were. If we were going on vacation, where were we going and how could they get a hold of us? You see, he was a minister and too many times they delayed funeral arrangements because the family could not be notified; they couldn’t get a hold of one of the relatives. Where were they? He always said, “Stay in touch.”

With a mission in mind, how do you stay in touch today? We have a vast amount of technology to help us, yet we often can’t find someone. Now, let’s complicate that a bit more with finding each other in an emergency. September is National Preparedness Month and this year’s theme is Don’t Wait, Communicate! It’s our wake-up to take action now. Hmmm, they must have talked to my dad.

Take some time this month and heed these safety tips on staying in touch!

1. Learn how to send updates via text and internet from your mobile phone to your contacts and social channels in case voice communications are not available. Text messages and the internet often have the ability to work in the event of a phone service disruption.

2. Keep extra batteries for your phone in a safe place, purchase a solar-powered, or hand crank charger. These chargers are good emergency tools to keep your laptop and other small

electronics working in the event of a power outage. If you own a car, purchase a car phone charger because you can charge your phone if you lose power at your home.

3. Program "In Case of Emergency" (ICE) contacts into your cell phone so emergency personnel can contact those people for you if you are unable to use your phone.

4. If you are evacuated and have call forwarding on your home phone, forward your home phone number to your cell phone number.

5. Prepare a family contact sheet. This should include at least one out-of-town contact that may be better able to reach family members in an emergency.

6. Conserve your cell phone battery by reducing the brightness of your screen, placing your phone in airplane mode, and closing apps, you are not using that draw power, unless you need to use the phone.

7. Get the FEMA App with these features:• Stay updated with severe weather alerts from the National

Weather Service for up to five locations across the U.S. • Learn how to stay safe before, during, and after over 20

types of hazards• Save a custom list of the items in your family’s emergency

kit• Locate and receive driving directions to open shelters

and disaster recovery centers• Submit disaster-related photos to a public map using the

Disaster Reporter feature. • The FEMA App is also available in Spanish. Download the

app to your mobile device or smartphone free on iTunes or Google Play. Learn more at www.fema.gov/mobile-app.

The Cooperative Finance Corporation (CFC) pro-

vides distribution systems with 145 Key Ratio Trend Analysis (KRTA) results each year. Here is how Minnesota electric co-op’s compare for 2015 to the rest of the United States on 10 of the 145 key indicators:

STAYING IN TOUCHby Lidia Dilley Jacobson, Director of Safety and Loss Control

10 of the 145 indicators Minnesota Median

U.S. Median

1. Miles of line 2,261 2,6262. TIER 2.18 2.483. Equity as % of assets 41.88 44.234. Debt per consumer $ 3,150 $ 2,3625. Consumers per employee 291 3066. Annual growth in kW sales -4.27 -1.917. Average consumers per mile 3.94 68. Distribution plant per consumer $ 5,599 $ 4,7479. Line loss 4.96 5.1110. Service availability 99.98 99.96

HOW WE COMPARE

As Minnesotans, we share many unique seasons. The first one that comes to my mind is deer hunting, a week on MREA's

calendar where we rarely schedule an event. What about back to school time, craft sale season, graduation open houses or fishing season? Then of course, let's not forget the winter or spring break season, when we dream of escaping for breaths of warm air. Ah, the cold weather season, with some corners of the state harsher than others, the weather season definitely influences our industry more than any other variable.

MREA truly enjoys another special season. We know the dates are on the calendar, but there is a change in the air and a need for heightened unity and teamwork. It is Fall REMA Season! Printers hum a bit louder, the phones keep ringing and staff spends hours

organizing rosters, badges, presentations and agendas to make sure these fall conferences run smoothly.

Members from across the state have been convening at REMA conferences throughout each year since 1968. They have always been a great opportunity to network with peers with similar responsibilities and catch up on hot industry trends and topics.

To begin the fall run of conferences, 86 REMA finance managers from Minnesota and Wisconsin converged in Baxter, Minn. on August 24-26 for their conference themed, “Networking Unplugged.” Next up, was the REMA Line Superintendents Conference on August 31-September 2. This event saw 67 line superintendents and 135 vendors staffing 49 vendor booths at a three-hour outdoor trade show featuring a steak and rib barbeque. On Thursday that week, members and vendors golfed or sported clays and enjoyed a sunset sail on the Breezy Belle. One week later, MREA staff was on the road again to the beautiful tranquil Thumper Pond Resort in Ottertail for the Fall REMA CEO Conference. This event featured a collaboration of 40 CEOs, 37 vendor members, and sightings of two recently retired CEOs, Lynette Nieuwsma and Rick Burud. Their golf outing ended early due to rain, but all still enjoyed the camaraderie. The September 21-23 REMA Engineers and Operations Managers Conference wrapped up the fall tour of REMA meetings at The Inn on Lake Superior in Duluth, their favorite sojourn for the past 15 years. We saw 91 conference attendees and 79 vendor members at the trade show representing 34 companies.

The REMA Board members would like to thank the following vendor members who sponsored speakers and extra events at fall REMA conferences: Altec, Brady Martz, Carr’s Tree Service, CoBank, Carlson Highland, Clifton Larson Allen, Eide Bailly, FS3, Federated Rural Electric Insurance Exchange, Geronimo Energy, Highline Construction, RESCO, Solomon, and Terex.

FALL REMA SEASON by Shari Wormwood, Communications Specialist

Watching the sunset on the Breezy Belle

REMA CEO Golf Outing

Phone: 763.424.1020 Fax: 763.424.5820 Website: www.mrea.org

Nineteen cooperative boards have adopted the common methodology developed by the MREA net metering working

group, comprised of MREA members and Jim Horan, MREA Director of Government Relations and Counsel, to implement the new authority gained in the 2015 legislative session to recover fixed costs from interconnected Distributed Generation (DG) facilities. Renewable energy groups filed a complaint with the Public Utilities Commission (PUC) when these cooperatives provided notice of this fee, requesting that it be investigated by the PUC and suspended during the course of the investigation. MREA argued against an investigation and a suspension. However, the PUC has now begun an investigation (docket E-999/PR16-512), and MREA worked with the net metering team and all of our members to prepare a response to the PUC’s questions (filed on September 19). As such, our goal is to establish through this investigation that any and all Minnesota cooperatives adopting this approach, now or in the future, can do so without fearing additional PUC entanglements.

On August 11, Jim Horan participated in a PUC Hearing held to focus on the issue of whether cooperatives that have adopted the grid access fee would be required to suspend them during the investigation, as requested by numerous parties representing renewable energy interests. The result of the hearing was the

commission adopted a ‘rule variance’ which has the effect of not requiring a suspension of the fees during the investigation.

This is a step in a good direction. Dare I say – it is a ray of good news.

Much remains to be done. It is our belief the PUC’s authority to investigate is limited to affirming the methodology adopted complies with the statutory language, including that it is indeed ‘reasonable and appropriate’ based on the cost of service. We will continue to demonstrate to the regulators that our cooperatives have met the requirements and appropriately balanced the issues, thereby protecting ratepayers and the public in adopting this fee. This grid access fee provides a tool to do just that, by ensuring those that install DG pay an appropriate share of the system’s fixed costs. This could be a long process, and promises to consume substantial resources within MREA, for the members of the net metering working group and across our membership as we provide information and present our position. The feedback from our members continues to emphasize the importance of this endeavor, and we appreciate the work and focus required by many of you to carry this effort forward together.

DISTRIBUTED GENERATION GRID ACCESS FEEA GOOD STEPby Darrick Moe, President and CEO