Electric cooperatives are private, not-for-profit businesses governed by their consumer-members. Two federal requirements for all co-ops, including electric co-ops, are democratic governance and operation at cost. Every consumer-member can vote to choose local boards that oversee the co-op, and the co-op must, return to consumer-members revenue above what is needed for operation. Under this structure, electric co-ops provide economic benefits to their local communities rather than distant stockholders.
An electric cooperative is:
- a private, independent electric utility business.
- incorporated under the law of the state in which it operates.
- established to provide at-cost electric service.
- owned by the consumers it serves
- governed by a board of directors elected from the membership, which sets policies and procedures that are implemented by the cooperative's professional staff.
These are the principles that differentiate the cooperative form of business:
- Voluntary and open membership
- Democratic member control
- Members' economic participation
- Autonomy and independence
- Education, training and information
- Cooperation among cooperatives
- Concern for community