Electric Cooperatives: The Key To Widespread-Solar Deployment in the Dakotas?

Cooperatives have long served a crucial role in America’s electric utility industry, with nearly 900 cooperatives today collectively serving 56% of the country’s landmass. While customers in and around urban centers may have little appreciation for cooperatives, rural communities rely on the cooperative model for providing electricity and distributing information about new energy opportunities in areas where corporate for-profit utilities do not operate.

For the past 12 years, SEPA has surveyed electric cooperatives across the U.S. as part of its annual Utility Solar Market Snapshot, tracking residential, non-residential, and utility-supply solar deployment data. Despite continued growth in states like Hawaii and Texas, the 2019 Solar Market Snapshot Report found a lull in deployment by electric cooperatives, with new capacity interconnected down 51% in 2018 compared to 2017. However, SEPA’s survey outreach has discovered that interest in solar is growing at electric cooperatives, even in states rarely associated with solar growth — North and South Dakota.

Bringing the Benefits of Solar to Ranchers in the Dakotas

Solar is not a new development for Verendrye Electric Cooperative in Velva, North Dakota. Tom Jespersen, energy advisor at the co-op, estimates that over the past 28 years he has helped install more than 275 solar-powered water well pumps for cooperative members. Verendrye Electric’s solar program is based on a very pragmatic need – helping members save money while providing water for livestock at locations far removed from existing electrical infrastructure. At an average installation cost of $800, a solar-powered well pump avoids the expense of setting poles and stringing electrical lines – which can cost as high as $15,000 a mile. From an initial installation of six systems in 1991, Verendrye’s program has grown by word of mouth. The program’s success has led Verendrye Electric to provide solar well installations to ranchers outside the cooperative’s service area looking to reap the cost saving benefits and self sufficiency these systems provide.

In Mitchell, South Dakota, Patrick Soukup, manager of marketing and member services at Central Electric Cooperative has been installing solar-powered pumps for the past four years. In that time, the program has seen dramatic growth, benefitting from insights and best practices that Soukup gained from similar programs at cooperatives like Verendrye.

As with Verendrye, Central Electric’s co-op members are interested in solar-powered pumps due to the cost-savings. Most had not heard of the systems until seeing a neighbor install one prompted them to contact the co-op for more information. In his role, Soukup works directly with interested members to evaluate their case for solar. Some members simply need sufficient power to operate a well throughout the day, while others require multiple days of pumped water availability for larger cattle stocks, requiring increased solar panel capacity or the addition of a battery storage system.

Importance of Trusted Cooperative Member Outreach

While most discussions begin with solar well pumps, customers are also interested in expanding their energy production for current or future needs by installing solar panels to power their homes. Growing member interest led Central Electric to install a 36-panel photovoltaic (PV) system in 2015 for its own use. The goal of the project was to understand the power and timing of system output, as well as the impact of environmental conditions in South Dakota on solar production, from heat and dust in the summer to cold and snow in the winter.

Central Electric presented data from its test installation at two well-attended member information sessions in 2017. Soukup believes it is important to clearly explain the benefits and challenges of solar energy to members, and ensure that they understand the impact on system reliability and production of energy during peak demand times. The sessions were so successful that Central Electric was recognized with a gold Spotlight on Excellence Award for Best Event by the National Rural Electric Cooperative Association (NRECA).

Verendrye Electric’s Tom Jesperson also noted growing member interest in home solar-panel installations, estimating a four-fold increase in inquiries over the past five years. Most members are still not choosing to install, for reasons that Jesperson believes include cost and uncertainty about the ability to provide reliable power at times of peak need. Furthermore, a lack of experienced local electricians and inspectors, as well as an absence of local incentives for renewable energy in North Dakota also serve as barriers to adoption. In South Dakota, Soukop also finds that most Central Electric members are not yet ready to install their own solar systems, although they want to be kept up to date on the technology and pricing.

Soukop and Jesperson share the opinion that as technology continues to improve, and the price of solar continues to drop, member interest will continue to grow. They are keeping an eye on the promise of improved battery systems to compliment variable solar generation and provide energy during times of peak demand. With electric cooperatives providing energy to 90% of South Dakota’s geographic area, their potential impact should not be overlooked.

Cooperative members rely on Verendrye and Central Electric as trusted-advisors to provide them with the information and guidance needed to make informed solar choices, as well as to review offers from private companies such as First Solar that are active in the region. Strong relationships, built upon trust and transparency, between these cooperatives and their members are critical to the sustained interest and growth of solar in rural America.

Spurred by Regulatory Change, Renewables Development Poised to Accelerate  

While North Dakota currently sits last in installed solar capacity among all 50 states, the District of Columbia and Puerto Rico, the state does not lag in renewables energy overall, with 3,155MW of installed wind capacity (ranking 10th in the U.S.) providing over 25% of the state’s energy production.

In a heavily agricultural state like North Dakota, the ability to continue farming on land where wind turbines are sited has helped ease the resource’s adoption. An existing state regulation which prohibits agricultural lands from being converted to other uses could limit the availability of lands for future solar projects. Despite this, North Dakota’s first commercial solar energy project received approval from the North Dakota Public Service Commission (PSC) in February of this year. The 200MW facility, to be built in Cass County by Geronimo Energy, will begin operations by the end of 2020.

Following the review and approval of the Cass County facility, the PSC has recommended the repeal of the farmland usage prohibition. Strong local support, including from the farm owners upon whose land the array will be sited, facilitated the approval and prevented any objections over the utilization of farmland for the project. Although the proposal must still work its way through the state’s rulemaking bodies, if approved it could further pave the way for future solar projects in the state.

With the first project approved and underway, members of the North Dakota PSC expect more in the near future. The future of solar in the Dakotas will depend greatly on continued member engagement by electric cooperatives and their role as trusted advisors to the communities they serve.