Societal Actors and Dominant Smart Grid Visions - Smart Grid (R) Evolution: Electric Power Struggles - page 78

as the Los Angeles Department of Water & Power or the Long Island Power Authority,
serve more than a million customers. Municipal utilities (sometimes referred to as munis)
are not-for-profit organizations and can access tax-exempt financing to fund their projects.
Munis can be organized in many ways: they can operate as a city department and either
report directly to the city council or operate as an independent city agency. In some cases
they are city-owned corporations and in others they work as municipal utility districts.
They serve their communities directly, and revenue from their electricity sales often
cross-subsidizes other municipal services such as fire protection or the police department.
Their access to capital and institutional capability to capture the benefits of smart grid
also varies considerably (Fischlein, Smith, and Wilson 2009 ) . Some municipal utilities,
like Austin Energy in Texas, have been at the forefront of developing smart grid systems,
with their Pecan Street Project linking more than 1,000 customers with smart meters, and
including some with rooftop solar PV generation and plug-in electric vehicles (discussed
further in Chapter 7 ) . However, other munis feel constrained to limit investment in smart
grid to maintain the lowest possible electric rates for their community. If a municipal utility
wanted to roll out a project of 50,000 smart meters, the municipal utility manager would
need to make a proposal to the city manager or city council. Local citizens could state their
positions during public meetings and the city manager or council members would vote to
approve or deny the project. Munis are represented in Washington D.C. by the American
Public Power Association, which has lobbied for “proven and cost-effective” smart grid
technologies (APPA 2014 ) .
The 873 rural electric cooperatives cover 80 percent of the United States land area, serve
19 million customers (and 42 million people) and account for 11 percent of electricity sales
in forty-seven states (APPA 2013 ) . Rural electric cooperatives were born out of the 1930's
New Deal, when 90 percent of all rural homes did not have access to electricity. Rural
electric cooperatives are private nonprofit entities which are governed by a board elected
by their utility customers. They are divided into those which operate the low-voltage
distribution networks and manage customer sales and those that generate electricity and
run the high-voltage lines (these rural cooperatives are sometimes referred to as G&Ts,
which represents their focus on generation and transmission). G&Ts are governed by
representatives from its member distribution cooperatives. To maintain their tax-exempt
status and qualify for low-rate federal loans (rates of ∼ 4.2-4.7 percent) for infrastructure
investments, co-ops must earn 85 percent of their income. They are represented in
Washington D.C. by the National Rural Electric Cooperative Association (NRECA), a
powerful lobbying organization. As rural electric co-ops tend to be coal-intensive, NRECA
has been vocal in its opposition to climate change legislation. For example, its members