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Cooperative History

View the video below to find out more about how electric cooperatives were started and the principles that your cooperative was founded on. 

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The common bond for cooperatives is conducting business the cooperative way. For electric cooperatives, that means continuing their proud record of service to 30 million people all across the nation and a commitment to continue expanding their horizons every way they can.

What exactly is a cooperative? If you ask that question to a number of individuals, you are likely to receive an equal number of different answers. Ever since you began receiving electric service from Farmers' Electric you have been told that you are a member of the Cooperative. But what exactly does being a member of Farmers' Electric mean for you?

First, a little history

In the early 1900's electricity was considered a luxury, available only in the large urban areas of our nation. As the years passed, power-lines were extended to serve more and more consumers in the cities and was quickly being thought of as a necessity rather than a luxury. However, as America's cities became electrified, rural America was left in the dark. As late as the mid-1930s, nine out of ten rural homes were without electricity. Farm workers milked cows by hand. Farm wives cooked on wood stoves and washed clothes on a wash-board. Water was pumped by hand and carried to the house. Food was preserved by canning or stored for a time in the "root cellar". Students read and completed homework assignments by the light of a kerosene lantern.

Electric lines from the Investor Owned Utilities (IOUs) eventually made their way out of the cities along major roads. If you were lucky enough to live close to the line, you were able to hook-up, if you paid the entire cost of getting the line to your home. When electricity was available in rural areas, it was very expensive, sometimes costing as much as forty cents per kilowatt-hour. Today, residential members of Farmers' Electric pay about eight cents per kilowatt-hour. If you lived some distance from the existing lines, you were out of luck. IOUs flatly refused to extend their lines to serve thinly populated areas because those areas didn't offer a reasonable return on the required investment. Currently, the average IOU serves approximately 35 consumers per mile of line while Farmers' Electric serves 2.7 consumers per mile of line.

There didn't seem to be much chance that rural areas would receive electricity in the near future. But in 1935, Franklin D. Roosevelt established the Rural Electrification Administration (REA) which would offer federal assistance, in the form of loans, for constructing electric lines throughout rural America. Monies were loaned to farmers and rural businessmen who had formed groups called cooperatives. By working together, rural Americans were able to get power to their homes and businesses.

Farmers' Electric Cooperative was formed by a group of area farmers in 1937, borrowing an initial $100,000 from REA. From that small beginning, your cooperative has grown to serve more than 6,800 members who receive power throughout 4,100 miles of energized line. We currently have 12,600 meters on our system.

The Cooperative Concept

Farmers' Electric Cooperative is an independent, locally owned business. As a member you own a portion of this business and ultimately share responsibility for the success or failure of the Cooperative. Farmers' Electric is a non-profit organization, meaning we don't have a group of investors, who are not our customers, deciding what will yield the most profit. In short, you receive electricity at the cost of providing that service to your home or business. Since Farmers' Electric is a non-profit organization, we are required by law to return to the members all margins (profits) above and beyond the cost of providing electricity and those margins are assigned to the members through capital credit allocations. Your share of the capital credits is determined by how much money you spend with the Cooperative purchasing electricity and electric services and is refunded as financial conditions permit.

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