Electric Co-op Today

Under the program, RUS would be authorized to loan $4.9 billion at zero interest to individual co-ops or coordinated groups of co-ops, such as statewide associations.

House Majority Whip James E. Clyburn, D-S.C., addresses an energy-efficiency news conference with Rep. John Spratt, D-S.C. (c) and Sen. Lindsay Graham, R-S.C. (Photo By: Steven Johnson)

Co-ops would in turn issue loans at up to 3 percent interest to members for a variety of improvements, such as weather stripping, insulation and heat pumps. Members would repay the loan through an extra charge on their bills, so that the efficiency improvements effectively pay for themselves.

Of the $1 billion cost, about $200 million is directed to startup costs, with another $1.1 million earmarked for additional RUS staffers to help run the program.

Co-ops will not make any profit from the program, English said, which coincides with the 75th anniversary of the rural electrification program.

Speakers at the news conference said the rural aspect of the program complements the Obama administration’s proposed Home Star program, which is based on a system of tax credits, as opposed to loans.

Rural residents are more likely to live in older houses, and typically spend $200 to $400 more on energy bills annually than comparable urban households, said Rep. Tom Perriello, D-Va.

“The cheapest electricity is the electricity you don’t have to buy in the first place because you are conserving,” he said. “So we’re increasing the value of our rural housing stock, as well as putting more money in people’s pockets.”

Michael Couick, president and CEO of The Electric Cooperatives of South Carolina said the program is designed with strong internal and external controls. Co-ops would act as general contractors for the projects, with accompanying responsibility.

“It’s not a giveaway; it’s a loan,” he said. “We take this very seriously, but I am confident that this program will work for our members and for the country.”

Clyburn said congressional sponsors will try to get budget authorization and then proceed with a course of action.

While it is possible that the bill could be attached to some other legislation, “we think this is a good enough bill to stand on its own,” he added.

In addition to Clyburn and Perriello, the House co-sponsors are Budget Committee Chairman John Spratt, D-S.C., and Rep. Ed Whitfield, R-Ky.

Senate cosponsors are Richard Lugar, R-Ind., Jeff Merkley, D-Ore., Tim Johnson, D-S.D., Jeanne Shaheen, D-N.H., and Michael F. Bennet, D-Colo., as well as Graham.

Tags: Efficiency and Conservation, Legislation, Rural Utilities Service