That electricity charging your smartphone might seem identical anywhere in the United States, but the organizations providing it differ dramatically.
America’s power providers fall into three main groups: investor-owned utilities, public power utilities and electric cooperatives. While IOUs supply electricity to about two-thirds of American households, public power and co-ops take a distinct community-driven approach, placing local needs above profits.
“An investor-owned utility is having to make a profit for their shareholders,” says Travis Million, CEO of Alaska-based Golden Valley Electric Association. “At a co-op, we’re owned by our membership. Any margins we make we either return to our members as capital credits or we reinvest that into our infrastructure to keep reliability high and costs down.”
Public power utilities also prioritize community interests. Owned by local governments, these utilities are accountable to residents and local officials, keeping rates low to keep taxpayers happy. Decisions are made by locally elected or appointed officials accountable to their community members rather than distant shareholders.
Decisions Made Close to Home
At co-ops, members have a direct voice. Decisions are made by member-elected board members—not by distant executives in a high-rise boardroom.
“They’re truly the voice of the membership,” Travis says. “We get immediate feedback from them and staff on what they’re hearing from the membership so we can make quick decisions on how to address those issues.”
That’s a sharp contrast to IOUs, where decisions often come from faraway corporate offices with little connection to the people actually using the power. If a customer has a concern, they’ll likely have a difficult time getting the utility’s management to listen.
Tailored Solutions for Local Challenges
Because they operate close to the people they serve, community-owned utilities can respond quickly and effectively to regional challenges. Golden Valley Electric, for example, faces extreme winters where reliable electricity is a matter of life or death.
“When it’s 50 below zero in the middle of winter, electricity is not a nicety,” Travis says. “It’s a necessity for survival.”
To meet that need, Golden Valley pre-positions crews and equipment throughout its service area to quickly handle outages—even in the most remote locations. IOUs, on the other hand, often prioritize urban centers where profits are higher, leaving rural areas with longer wait times or fewer resources.
Relationships Built Through Service
Ken Klotz, general manager of Ohop Mutual Light Co. in Eatonville, Washington, says one of the greatest advantages of community ownership is the ability to build meaningful relationships with the people they serve.
“While social media has some advantages, it does not compare to the real connections created by listening to our members,” Ken says. “A happy face or thumbs-up emoji is not the same as seeing a bright smile or hearing heartfelt laughter from members.”
Those relationships are cultivated through consistent and intentional in-person interactions. Ohop Mutual shows up year-round for its communities, participating in Fourth of July and Christmas parades, volunteering during 9/11 Day of Service cleanup efforts, hosting community dinners and organizating service projects.
“Local governance and member ownership helps us keep aligned with our goals and commitment to our members,” Ken says. “It reminds us that we are in business to serve others and this helps us prioritize what is important.”
Listening and Responding
That philosophy also drives member-supported programs that give back. At Golden Valley, the REDUCE (Responsible Energy Decisions Using Cost-effective Efficiencies) program offers low-interest financing for energy-efficient upgrades, helping members lower their bills and improve their homes. Their Good¢ents Program—funded by members who round up their bills—has funneled more than $1.3 million into local nonprofits.
Ohop Mutual’s Operation Round Up does the same, helping members in crisis with essential needs like electricity, food, housing and medical expenses.
The Power of Neighborliness
While IOUs are focused on shareholder returns, co-ops and public power utilities are focused on people. That difference plays out in how electric utilities collaborate, too. Golden Valley works closely with other Alaskan utilities on infrastructure and providing mutual aid to get power back on after natural and man-made disasters cause widespread outages.
So the next time you flip a switch or charge your phone, it’s worth asking who’s behind the plug.
Beyond electricity, community-owned utilities also deliver trust, accountability and a long-standing commitment to the people they serve. And that’s a kind of power you won’t find on Wall Street.