Rural Electrification Associations

[Dewey Cox]

I thought I'd start this thread as a tangent of the Foritis thread.
What are your thoughts on the REA?
Do you think they are an important part of the electric grid?
Do you think they're obsolete?
Do you know what they are? (I didn't know I was in one when I bought my place)

I'm in a roughly 500 site, non operating REA. I get the feeling that out of the 500, the dozen or so who think the rea is valuable are on the board.
But I also don't think the rest care too much either way, since the annual meetings only ever get a couple dozen people turning out.
Maybe if they realized the money that is in it for them, selling out might become really popular.

[Grizzly Adams]

I regret we sold out Transalta in it's day, seemed like the smart thing to do at the time. Now my power bills start at a hundred bucks, "Transmission Charges". My natural gas is with the equivalent of an REA, some months about 20.

Grizz

[Au revoir, Gopher]

Originally Posted by Grizzly Adams

I regret we sold out Transalta in it's day, seemed like the smart thing to do at the time. Now my power bills start at a hundred bucks, "Transmission Charges". My natural gas is with the equivalent of an REA, some months about 20.

Grizz

Which gas co-op? Our bill starts at more than $20 before any gas usage is added...

But it still beats the hell out of dealing with propane deliveries.

ARG

[Dewey Cox]

Gas coops can produce and sell their own gas.
It is my understanding that rea's are prevented from making their own power though legislation.

[Cement Bench]

Originally Posted by Dewey Cox

Gas coops can produce and sell their own gas.
It is my understanding that rea's are prevented from making their own power though legislation.

the great equs rea has prairie power as a subsidiary

fancy that and do the directors get paid 100 g each for their time
and does equs not discuss this at their annual meetings, and yiu,have to register for the annual meetings and if they don’t like yiu they tell you the meeting is already full?

yep transparency at its best

[Cement Bench]

Originally Posted by Grizzly Adams

I regret we sold out Transalta in it's day, seemed like the smart thing to do at the time. Now my power bills start at a hundred bucks, "Transmission Charges". My natural gas is with the equivalent of an REA, some months about 20.

Grizz

Please let us know what rea it was, how much it sold for and how much each member got

then I will comment on your post from a cost/benefit standpoint

then u may change your mind

[Grizzly Adams]

Originally Posted by Cement Bench

Please let us know what rea it was, how much it sold for and how much each member got

then I will comment on your post from a cost/benefit standpoint

then u may change your mind

It was about 30 years ago, I can't remember the details, but it was peanuts in today's terms. My last gas bill for the month for the month, which included heating was 65. total, power on the other hand was 140. , of which 114 was transmission charge.

Grizz

[Dewey Cox]

I've run the numbers where I live, and the rea bill looks to be about $40 a month more than the equivalent with atco.

[pikeslayer22]

Ours had two attempts by Atco to buy members out. Would have been 30k a tap. Got voted out twice in as many years.

[urban rednek]

The official history of REA's in Alberta:
http://www.history.alberta.ca/energy...ta.aspx#page-1

By the end of the First World War, electricity was well established in Alberta. The province was home to the first municipally-owned power utility in the country; Edmonton, Calgary and Lethbridge all enjoyed the benefits of modern, electric streetcar systems; and the Bow River had been harnessed to generate power at the Horseshoe Falls Dam, with plans for future hydroelectric development well underway. There was just one group that had not yet enjoyed the benefits of electricity—the majority of the population that lived in rural, rather than urban, Alberta.

Up through the 1920s, there was little pressure to extend electricity into rural Alberta. Electricity was still viewed as something of a novelty rather than as a necessity, and the cost of rural electrification was prohibitive, both for the companies that would have to pay for the new infrastructure necessary to deliver it, and by the farmers themselves who would have to add the monthly cost of electricity to already tight operating budgets. By the early 1920s, however, a third option was being discussed throughout the province—a publicly-owned utility. The province would assume financial responsibility for the cost of the infrastructure and regulate prices to ensure a fair deal for farmers. Public utilities were well established at the provincial level in Manitoba and Ontario, and momentum seemed to be moving Alberta in that direction after the First World War. In addition, a new government, the United Farmers of Alberta (UFA), took power in Alberta.

The UFA began as a grassroots populist movement and entered politics for the first time with great success in the 1921 provincial election, winning a majority government. Resolutions at UFA conventions across the province had called for rural electrification and public ownership, resolutions that were supported by the women’s auxiliary of the movement, the United Farm Women of Alberta. The UFA government explored the possibility of rural electrification in the 1920s, but the estimated cost—$200 million—was deemed prohibitively expensive. Still, advocates pushed for rural electrification and public ownership through the 1920s until the Great Depression shelved any possibility of such a major public investment. In short, the government could not afford to pay for the infrastructure, and farmers certainly couldn’t pay for the monthly cost in the ravaged agricultural economy.

Pressure for rural electrification resumed after the Second World War. Electricity was no longer viewed as a frivolous luxury, either by farmers (who increasingly viewed it as essential to the operation of their farms) or by their wives (who wanted access to labour-saving electronic appliances that were increasingly available after the Second World War). Alberta certainly stood out as lagging far behind in rural electrification; in 1945, less than four percent of Alberta farms had electricity, a number far behind most other provinces and the American Midwest. Further, the cause of rural electrification (and public utility ownership) received political support from the Co-operative Commonwealth Federation, one of the opposition parties challenging Social Credit’s hold on power in Alberta. Against the forces calling for rural electrification and public ownership were the power companies, who resisted delivering power to rural areas because of the cost; urban dwellers, who did not want to bear the cost of the necessary infrastructure; and the Social Credit premier, Ernest Manning, who recognized the pressing need for rural electrification, but was staunchly opposed to public ownership. The issue was finally decided in a heated 1948 plebiscite, when the voters of Alberta rejected public ownership by the narrowest of margins (the ‘no’ side won by 151 votes out of a total of 279,831 cast).

With the idea of government ownership now dismissed, the cost of rural electrification would fall to the farmers, who turned to a solution typical of the rural West—the co-operative. Farmers across the province organized into co-ops to raise half the necessary money for electricity in their districts; the government provided the rest of the money in the form of loans. By the late 1960s, a total of 416 co-ops (known as Rural Electrification Associations, or REAs) had been established. The REAs would own the power distribution system in their districts, while the power companies provided the electricity and the maintenance. Many REAs even played a significant role providing labour for building the infrastructure, lending a hand with preparing and raising power poles. The results were extraordinary; while only a tiny minority of Albertan farmers enjoyed the benefits of electricity at the end of the Second World War, 87% of rural Alberta had access to electricity by 1961.

IMO- REA's were resident owned, non-profit, Co-Ops created to reduce the cost of services provided by allowing sweat equity investment and amortizing the actual capital costs without a yearly allowance for corporate bureaucracy and ROI.
IME in Central Alberta- by the 1990's, the REA's were still providing considerably lower cost service installs and monthly rates than the big utilities. (ie. $8K vs $65K for the exact same overhead line) However, they were neglecting regular line maintenance in the hopes of keeping operating costs down. Preferring to perform reactive maintenance rather than being proactive, as in, we won't replace that obviously bad pole until you lose power. (anecdotal)
Many REA's at that time were carrying maintenance backlogs estimated to be in the millions of dollars, with no plans in place to cover the anticipated catastrophic failures other than to petition the government for emergency funds to repair their failing asset. (conjecture)

At some point, many REA's morphed from a non-profit Co-Op to a for-profit business entity for the sole benefit of the members of the board running the show. Much like the history of labour unions. (opinion)

[Big Grey Wolf]

REA's just need to cover operating costs. They do not need big $$$ profits like Fortis etc. I am very happy with my REA, once boys worked half the night in pouring rain to get my power back on.

[Cement Bench]

Originally Posted by Dewey Cox

I've run the numbers where I live, and the rea bill looks to be about $40 a month more than the equivalent with atco.

one of our directors on the board for the local rea did a comparison for rea rates versus fortis on the acreage and farm as a business rate a couple of years ago and spoke about it at the annual meeting or a local info meeting
it was about,half and half as to which was greater

the DVD rea has the lowest rea rate in Alberta and the chairman had to ask fortis rep at the annual meeting if the rate was good or not, these people are buffoons

Also

USE SPOT POWER their rates are the best

most of our rea members changed from atco to spot power when the amalgamation vote to GIVE our assets to equs failed miserably

check them out they are great

[Cement Bench]

Originally Posted by Grizzly Adams

It was about 30 years ago, I can't remember the details, but it was peanuts in today's terms. My last gas bill for the month for the month, which included heating was 65. total, power on the other hand was 140. , of which 114 was transmission charge.

Grizz

2 points


1. my electrical consumption varies from 47 dollars to 110 over the last year
January 2020 was brutal and not on a fixed rate
So it averaged 60 bucks over the year for power only

2. our rea was worth 25000 to sell 6 years ago, if you took the money and bought fortis or bank shares at 5 or 6 % dividend then after the dividend tax you would get about 1200 net a month

So my consumption would be less than the money earned on the sale

I WOULD NEVER EVER HAVE TO OAY A CENT FOR MY POWER BILL AGAIN

and the shares would have doubled over time and even more

so to sell is a no-brainer

also fortis can tell if your power is out, equs always says. are you sure when we call , what a joke

the call Center of fortis is great, they also know where their employees are on a computer screen and can direct them to the best place to start the repair

our rea had equs respond to one of the complainers site for a garage fire and it took just shy of 4 hours in the winter

what a joke

our rea has no poles, no wire nothing to repair the lines

Most rea’s rely on fortis or atco to do the work

problems arise when the rea farmers try to not spend the money to clear the brush. think California

Time to sell boys and girls and unlock the 800-900 million bucks in the very old and now useless TREA system

spot power is my Xmas gift to you

Later eh

[Cement Bench]

Originally Posted by Big Grey Wolf

REA's just need to cover operating costs. They do not need big $$$ profits like Fortis etc. I am very happy with my REA, once boys worked half the night in pouring rain to get my power back on.

my friend thanks for the half-truth

what you have cited is the theory behind rea’s

here is the truth——— fortis rates and construction is approved by the provincial govt (perhaps through the AUC board, not sure) they are allowed some profit to pay a dividend and that is it

They are called A REGULATED UTILITY FOR A REASON, and the stock market prices that into their stock, they never make great profits

Now the better question for you is this

how much does your rea have in reserves

most have less than 2000 bucks per member, and try to get that amount from equs it may be a lot less

so our rea is worth say 15 million and we have a ice storm that destroys 50% of our lines

net worth is 25 grand per service on a per capital basis but costs 30 grand per service to rebuild as 25 g is the net value after depreciation

so we would need to raise 7.5 million or have a cash call of 13000 per member/owner

I personally met with govt officials who said on,behalf of Alberta govt a couple or years ago for the public inquiry that the govt would LEND US MONEY BUT WE HAVE TO PAY IT BACK IN FULL WITH INTEREST

SO REA SOUP FANS

how do you like to pay for the service then NOW HALF TO BUCK UP ANOTHER 13000 JUST TO GET YOUR POWER RESTORED THEN PAY INTEREST UNTIL IT IS PAID BACK

fortis customers just get their power poles and wire repaired at no cost

You choose, the rea’s are UNDERFUNDED

rea’s NONE OF THEM IN ALBERTA HAVE A COMPLETE LEGAL MEMBERSHIP LIST, this from the public inquiry

I could go on and on but just sell and pocket the money

spent over 1000 hours on this effort to correct out corrupt rea

check out the Facebook page for the tomahawk rea membership society

hundreds of pages going back 5 years for your entertainment pleasure

[Dean2]

Originally Posted by Cement Bench

2 points


1. my electrical consumption varies from 47 dollars to 110 over the last year
January 2020 was brutal and not on a fixed rate
So it averaged 60 bucks over the year for power only

2. our rea was worth 25000 to sell 6 years ago, if you took the money and bought fortis or bank shares at 5 or 6 % dividend then after the dividend tax you would get about 1200 net a month

So my consumption would be less than the money earned on the sale

I WOULD NEVER EVER HAVE TO OAY A CENT FOR MY POWER BILL AGAIN

and the shares would have doubled over time and even more

so to sell is a no-brainer

also fortis can tell if your power is out, equs always says. are you sure when we call , what a joke

the call Center of fortis is great, they also know where their employees are on a computer screen and can direct them to the best place to start the repair

our rea had equs respond to one of the complainers site for a garage fire and it took just shy of 4 hours in the winter

what a joke

our rea has no poles, no wire nothing to repair the lines

Most rea’s rely on fortis or atco to do the work

problems arise when the rea farmers try to not spend the money to clear the brush. think California

Time to sell boys and girls and unlock the 800-900 million bucks in the very old and now useless TREA system

spot power is my Xmas gift to you

Later eh

Your math is WAY out. 5% on 25,000 is only $1,250 a year, not a month. Quite a difference. Now that might still come close to covering your annual electrical bill but it wouldn't cover mine.

That said, have lived under REA and the bigs. Most REAs are run very badlly and there is nothing you can do about it. I will pay more for the reliability of ATCO, Fortis etc power.

[Cement Bench]

the AFREA has for sale the book

Country Power and it is a very good read,

does not tell the full story and exaggerates a lot but a great book on this part of our gear history of a province

also available as a e-book

see I am not all bad, both sides have some merit

[Cement Bench]

Originally Posted by Dean2

Your math is WAY out. 5% on 25,000 is only $1,250 a year, not a month. Quite a difference. Now that might still come close to covering your annual electrical bill but it wouldn't cover mine.

That said, have lived under REA and the bigs. Most REAs are run very badlly and there is nothing you can do about it. I will pay more for the reliability of ATCO, Fortis etc power.

you are correct, trying to type a lot this am

[Dewey Cox]

Originally Posted by Dean2

Your math is WAY out. 5% on 25,000 is only $1,250 a year, not a month. Quite a difference. Now that might still come close to covering your annual electrical bill but it wouldn't cover mine.

That said, have lived under REA and the bigs. Most REAs are run very badlly and there is nothing you can do about it. I will pay more for the reliability of ATCO, Fortis etc power.

There is something you can do about it.
Get on the board and push to make changes. (Or push to sell)