Cooperatives are not-for-profit, consumer-owned businesses. Electric utility cooperatives build and maintain three times the miles of power line of other utilities and do so at comparable rates despite fewer customers. They do this by operating on a not-for-profit, cost-of-service basis.
Once a member pays the membership fee, they become a part owner of the cooperative. They have a voice in how the cooperative is operated and influence this process through casting their vote at the annual meeting. It is also at the annual meeting that the members elect Cullman EC’s nine-member board of trustees from the membership. Three board positions are voted on at each annual meeting.
Because the members of the cooperative are also the owners this means the cooperative is locally owned and operated. Employees of the cooperative are also local residents who are familiar with the needs of the communities they serve.
Voluntary and Open Membership
Cooperatives are voluntary organizations, open to all persons able to use their services and willing to accept the responsibilities of membership, without gender, social, racial, political, or religious discrimination.
Democratic Member Control
Cooperatives are democratic organizations controlled by their members, who actively participate in setting policies and making decisions. The elected representatives are accountable to the membership. In primary cooperatives, members have equal voting rights (one member, one vote) and cooperatives at other levels are organized in a democratic manner.
Members’ Economic Participation
Members contribute equitably to, and democratically control, the capital of their cooperative. At least part of that capital is usually the common property of the cooperative. Members usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: developing the cooperative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the cooperative; and supporting other activities approved by the membership.
Autonomy and Independence
Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.
Education, Training, and Information
Cooperatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their cooperatives. They inform the general public, particularly young people and opinion leaders, about the nature and benefits of cooperation.
Cooperation Among Cooperatives
Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional, and international structures.
Concern for Community
While focusing on member needs, cooperatives work for the sustainable development of their communities through policies accepted by their members.
Who would have thought that a trip to Warm Springs, Georgia, by then President Franklin D. Roosevelt, would have meant so much, especially to rural residents in North Alabama? While there for polio therapy, FDR noticed his electric bill was over three times higher than it was in New York. Electricity only existed where it was “profitable,” and there were no guidelines for the electric rate structure. With the help of Congressmen George W. Norris of Nebraska, Sam Rayburn of Texas, Lister Hill and John Sparkman of Alabama, President Roosevelt created the Tennessee Valley Authority in 1933 and Rural Electrification Administration in 1935. In addition, the Alabama Cooperative Act of 1935 made it legal for farmers to organize non-profit cooperatives. Relief was coming to a nation where people who lived outside of bustling cities had to endure life without electricity.
Fourteen Cullman County farmers, after being turned down for electricity by Alabama Power Company and the Cullman Power Board, headed up the effort to electrify rural Cullman County. Alabama Power Company owned lines in Hanceville and one from the Marshall County line to Fairview, but because it was believed to be unprofitable, they were not interested in expanding their service to include all the families that wanted electricity (the co-op later purchased the right from Alabama Power to serve all the people of rural Cullman County). Cullman Power Board generated its own electricity but lacked the capacity to serve rural Cullman County.
Refusing to give up, the 14 farmers drove their own wagons and Ford Model As house to house over the countryside, collecting the $5 membership fees from other farmers.
Once word spread of the farmers’ efforts, Alabama Power sued the 14 organizers of Cullman EC to stop its organization. Attorney William E. James defended Cullman EC and helped convince the judge that the co-op was to become a reality.
When enough families had signed up per mile, REA sent an engineer from Washington, D.C., to do a feasibility study. Cullman EC’s first loan for $105,000 was approved, and the 14 men met in Mr. James’ office on May 25, 1936, to make the formation of Cullman EC official. They literally “passed the hat” and dug the crumpled dollar bills out of their pockets to pay the legal fees. These dedicated men never received compensation for their years of hard work and sacrifice.
The 14 farmers, now the co-op’s first board of directors, decided to hire their first employee, Gladys Graham, who took care of all the inside duties from secretarial to cashiering. Later the co-op hired M.C. Lovvorn to hang transformers, install meters and take care of power outages.
Cullman EC energized its first lines just east of the city of Cullman on Aug. 4, 1936, picking up 350 customers with 30 miles of line. Cullman EC was the second co-op in the state to incorporate but was the first one to energize its lines.
— This story was published in the February 2011 Alabama Living magazine as part of Cullman EC’s 75th anniversary celebration. Information for the article was taken from “Cullman Electric Cooperative – Beginning a New Era,” published in 1995.
Date of Organization: May 25, 1936
Emmett S. Oden
R. Lem Bates
Date Energized First Lines: August 4, 1936 – 30 miles, 350 members
Incorporated Towns Served
Number of Member Accounts Served: 43,143
Member Accounts Served by County
Cullman – 36,206
Lawrence – 129
Morgan – 827
Winston – 5,981
(Account total reflect Cullman EC membership statistics as of July 2018)
Source of Wholesale Power: Tennessee Valley Authority (TVA)
Cullman Electric Cooperative is a member of NRECA, the national service organization for more than 900 not-for-profit rural electric cooperatives and public power districts providing retail electric service to more than 42 million consumers in 47 states and whose retail sales account for approximately 12 percent of total electricity sales in the United States.
NRECA’s members include consumer-owned local distribution systems — the vast majority — and 66 generation and transmission (G&T) cooperatives that supply wholesale power to their distribution cooperative owner-members. Distribution and G&T cooperatives share an obligation to serve their members by providing safe, reliable and affordable electric service.
Cullman Electric Cooperative is a member of the Touchstone Energy Cooperatives brand, which represents a nationwide alliance made of 750 local, consumer-owned electric cooperatives in 46 states. Touchstone Energy co-ops collectively deliver power and energy solutions to more than 30 million members every day. Electric cooperatives distribute power for 75 percent of the U.S. land mass over 2.4 million miles of power lines.
Electric cooperatives were established to provide electricity to rural America, and now make up the largest electric utility network in the nation. Touchstone Energy is the national brand identity for that network.
Cullman Electric Cooperative is a member of AREA, the statewide trade association serving Alabama’s 22 electric distribution cooperatives, the Tennessee Valley Authority and PowerSouth Energy Cooperative.
Through AREA, all of Alabama’s electric cooperatives pool their resources to gain strength and efficiency on issues common to electric cooperatives. Services offered by AREA include legislative representation at the state and national levels, safety and training programs, environmental compliance consulting, worker compensation, health benefits plan, printing and design, youth and community programs, media relations and a monthly magazine for Alabama electric cooperative consumers.
AREA’s headquarters, which contains inside and outside training facilities, is in Montgomery.
Cullman Electric Cooperative purchases all of its wholesale electricity from the Tennessee Valley Authority. TVA is a corporation owned by the U.S. government and provides electricity for 9 million people in parts of seven southeastern states at prices below the national average. TVA, which receives no taxpayer money and makes no profits, also provides flood control, navigation, and land management for the Tennessee River system and assists utilities and state and local governments with economic development.
TVA Complaint Resolution Process — TVA provides regulatory oversight for your local power company’s rates and service practice policies. If you have an issue or complaint that you have not been able to resolve with your local power company, TVA’s Complaint Resolution Process may be able to help. There are three ways to begin the process: