The value of a utility isn’t just in the sum of its equipment and assets. Especially for public power utilities, the value is gained through how it supports its community in ensuring rates are affordable and equitable, reliable service doesn’t interrupt economic potential and opportunities, and that locally made decisions reflect the best interests of the community.
Despite the many ways public power provides value to the communities served, this true value is not often recognized, especially when it isn’t pointed out. Public power utility leaders need to ensure that their communities see the value of the utility as it is embedded throughout the community, not just its potential dollar value. Many public power utilities are making the effort to ensure their communities understand the value the utility brings, whether in pushing back against a buyout threat, spreading awareness, or reminding customers of the reasons to protect what they have.
Assets and Value
With their backs against a proverbial wall, city council members can start seeing potential price tags on any city asset — and overlook the long-term ramifications of a sale.
In Massachusetts, the Merrimac Municipal Light Department had to quickly pull together the numbers behind these distinctions when it faced a sudden proposal from the town’s Board of Selectmen to consider selling the utility. Mary Usovicz, Merrimac Light’s general manager, said the topic likely arose on the board’s agenda as a potential way to increase funds for the town.
The board brought up the consideration of selling the department at its meeting in late March 2023, proposing to add the article to sell to be voted on in its April meeting, less than one month away.
Given the short turnaround to address the sale, the message about the value of the utility to the town needed to get out quickly to drum up support. Right away, Usovicz called Energy New England, a regional electric cooperative, which includes Merrimac Light Department. Energy New England brought in support from the Northeast Public Power Association and the Municipal Electric Association of Massachusetts. The leadership of these entities joined with Usovicz and the Merrimac Light union leadership to develop a detailed response. Campaign activities, which could not be directly from the utility, included the utility’s commissioners sending a letter to all customers and a local union chapter helping to create and distribute lawn signs and door hangers to customers, among other materials. The materials pulled in key data, such as comparing rates and reliability indices between Merrimac Light and the neighboring investor-owned utility. Materials also explained how customers could participate in the board meeting to oppose the sale.
More than 1,000 people — out of a population of under 7,000 — came to the meeting to show their support for keeping ownership of the utility. The vote tally was 782 opposed to six in favor of the sale, and the measure was dropped.
Another key piece of educating about the utility’s value came in helping the board to better understand the nature of the utility’s financial position and potential value to the town. This involved getting a third-party evaluation, which helped clear up misconceptions about how any funds from a sale could be allocated to the town and what agreements and costs would change under a different ownership model. The evaluation helped show that while the utility held a strong financial position and consisted of high-value assets, by state law, most of any cash value from the sale would revert back to ratepayers, not to the city. The assessment also helped explain how the nature of offering the utility for sale would position it to be available at a discount to any buyer.
“They would buy us if it’s a fire sale, but their system might not integrate. They are buying an asset that might not be worth anything to them,” said Usovicz. If a sale had been allowed to go through, then the main value to the buyer, whether an IOU or another private entity, would be cracking open the door to allow for more buyouts, she cautioned.
“We’re a small [municipal light plant], but we are fighting the long-term threat. All you need to have is one example… It would be a crack in the foundation that could grow,” she said.
Usovicz credits having established dedicated communication channels for the utility, including a website and social media accounts, as being helpful in getting the message out. She noted that it could have set up a tough situation if the department had to rely on other city channels to connect with customers.
“The fact that we had built our own followers, our own website… it made it so people could reach us and ask questions,” she said.
She stressed that having separate communication channels isn’t just important when facing a potential sale but is increasingly helpful to communities who have lost other forms of local news, such as city papers that have stopped circulation in recent years.
Changing how utilities communicate with their customers isn’t about creating more work, but about aligning and updating utility roles with modern realities, said Usovicz. What used to maybe be a contribution to a bill stuffer or newsletter is now what becomes a slider on your website or a blog post, she gave as examples.
The experience pushed Usovicz to consider how to engage with the community more often. In addition to continuing to post to a blog and using the utility’s channels to share information and gratitude for customers’ support, Usovicz said Merrimac Light now holds a vote for customers to select electrification projects for local nonprofits to get funded each year. The department has long had funding allocated for such projects, but now customers can take an active part in the process, which also reminds them of the department’s continued investment in the community.
Honoring the Legacy
On March 18, 1895, the city of Elberton, Georgia held an election to decide whether to put in power for lighting the street. The measure passed 318 to nothing.
“There is basically nothing we have accomplished, whether domestically, economic development wise, or culturally, that would have happened had we not made that brave decision,” said Daniel Graves, Elberton’s mayor. “It was a public choice — a unanimous choice of a visionary people. We saw the future ahead of us and had the courage to reach out and grab it. It put us on a path to where we are today.”
Today, Elberton is known as the granite capital of the world and produces a significant portion of memorial headstones globally —about two-thirds, according to Graves. The industry is electricity-intensive, as it relies on various machinery including electric compressors, pumps, and saws.
He believes that visionary spirit continues to live on in Elberton, pointing to the development and expansion of high-speed internet service in the city. Such service, he said, helps in attracting new industrial and large business customers.
“While that’s not related to power directly, it is an offshoot of that same vision and is made possible because of the success that public power allowed us to venture into other areas,” he said.
Graves sees the indirect value of public power showing up in Elberton in many ways. As an example, he pointed to how any margins from the community-owned utility get immediately reinvested in the community to support everything from its police force and fire department to local athletics and nonprofits. He also credits the non-profit utility for staying ahead of system improvements and offering local jobs.
“It relieves tax burdens for our citizens while providing an essential service at a discount rate,” said Graves.
Elberton makes a point to celebrate Public Power Week each fall and makes sure that the utility is represented as a supporter on community service projects to maintain positive visibility across the community. Still, Graves acknowledged that it is difficult to keep the message of what public power means in front of the community.
“When things move smoothly and work well, when your reliability is world class, it’s inevitable that people just assume that’s the way it is,” said Graves. “When you’re talking about electricity and rates, these things are not real attention-getters. People will let you hide in the shadows and just do your job, as long as everything is going well.”
But, he said, public power utilities should make the effort to “toot their own horn a little bit,” to stay in front of the narrative and public sentiment about the utility.
As mayor, Graves has had numerous meetings with residents who are concerned about their utility bills. Residents have brought their bills to meetings with him, showing how their total amount to pay looks high compared to maybe a family member’s bill who lives outside of the city. This is primarily because the monthly bills in Elberton combine electric with other services, including water, sewer, and trash. He said he takes time to break down the bill and shows people how their electric rate compares to the rates of other providers across the state, which are publicly available on the Georgia Public Service Commission’s website.
“I have not had a single time that I haven’t been able to show the savings,” he said. And while he recognizes that residents are more concerned with how to pay the bill than how it is calculated, he noted that residents often “leave with a better understanding and appreciation for what they do in fact have.”
As a member of the Municipal Electric Association of Georgia, or MEAG, he and utility staff can also access data in real-time about how much power the city is using, how much energy it is selling and for how much, and what types of sources are comprising the fuel mix. He has found sharing this data has become more helpful in talking with prospective industrial and business customers in recent years.
“If you want to compete for modern industrial prospects, then the types and sources of electricity you are able to provide are a key factor,” he said. “If they’re really going to build a factory here, then we have to provide them with sustainable, non-carbon emitting sources of power.”
“One thing people don’t realize about our cities is that we were non-emitting before non-emitting was a thing,” he shared, in reference to the combined membership of MEAG. “We were over 60% non-emitting last year.”
Graves advised other public power utilities to extend awareness of what community ownership means, and its uniqueness, to the public.
“I’d encourage all public power utilities to learn about their story and be proud of it, own it. Pull your old minute books, learn about those who had this vision,” he stressed. “If we don’t protect the vision we’ve inherited, nobody else will.”
Essential Awareness
A few years ago, the Oklahoma Municipal Power Authority noticed a concerning result in its biannual survey of customers in its member cities: customers weren’t aware that their utility was locally owned and operated.
To remedy this, OMPA decided to launch an awareness campaign, Our Local Power, that would not only help people realize that their utility is community-owned, but that would also showcase the different contributions its 43 members make to their communities. The campaign includes a suite of messages that members can use on social media or other outlets, including video testimonials about the value of public power to different types of residents. In Comanche, Oklahoma, a video interview with the individual that runs the city’s recreational facilities spoke about how the utility provides power to local athletic fields at no charge.
Chuck Ralls, city manager for the City of Comanche, said the public power utility has been sure to use campaign materials in a customer appreciation event during Public Power Week, in local radio advertisements, and in branding prizes given out as part of an annual raffle.
Ralls said that the efforts has helped boost awareness of community ownership in Comanche by 60%.
Oklahoma doesn’t collect property taxes, so Ralls said the municipalities are reliant on sales tax. For small towns like Comanche, which get very low sales taxes from the few local businesses, the utility’s transfer to the general fund is imperative to cover other essential services, like the fire department and police.
“Without it, we would cease to exist. We would be a ghost town,” said Ralls.
Ralls said that awareness efforts need to be continuous, especially in areas like Comanche, which is seeing a lot of new residents moving in from other states. “As the demographics continue to change, we have to continually market who we are and what we do. [Customers] just don’t know,” he noted.
While high-visibility events and activities help, Ralls said it also helps to be able to tout the utility’s reliability against its neighboring IOUs, and reminding customers that local ownership correlates with higher reliability.
“We have a chain of grocery stores from across the state, and the response time and reliability is much lower in IOU territory. Whereas if we go out, we’re back up within an hour or two. Businesses recognize that local power… [means] we respond in a timely manner,” he said.
Utility messages also distinguish public power from cooperatives, which some customers might be familiar with.
Reinforcing Accountability
Ralls noted that utilities need to keep adapting along with technology and available methods of communication. Like Merrimac, Comanche’s local news outlets are limited, which is why Ralls said the utility focuses on radio ads for now, and is exploring other opportunities, like geofencing. He’s seeing reduced engagement on the utility’s Facebook account, and more in other social channels, like Instagram. The city also put in a public electric vehicle charger that is branded with the Our Local Power campaign.
While the channel might change, “the message is going to stay consistent — the value of ownership. That they have control over what the utility does,” added Ralls.
“A lot of companies pay experts thousands of dollars to gauge public sentiment concerning their utility. We have a pretty darn impactful community satisfaction survey every two years – it’s called an election,” said Graves.
With the elections, whether for his position as mayor or for council members, “there is nothing between our actions and the people,” said Graves. “We are directly accountable to our citizens on decisions we make on our power.”
