42 years in the electricity business

Jan 20 - McClatchy-Tribune Content Agency, LLC - David Little West Central Tribune, Willmar, Minn.

 

Most people expect the power to be there when they flip the switch, and they probably don't want to pay much for it.

But the reality is consumers may be unaware of factors that affect the cost of electricity, a retiring industry veteran said.

"One word of advice I would like to impart is that people need to be more active and educate themselves on what are the factors that drive the economy, which is electricity,'' said David George, who retires Jan. 30 after 42 years in the business, including the last 27 years as chief executive officer of Kandiyohi Power Cooperative in Spicer.

"But it's environmental factors. It's the growing demand that we as customers are putting on the system, and it's also the non-environmental regulations but other types of government regulations that impact cost,'' George said.

"So educate yourselves in regard to what are the cost drivers and then what can you do to help guide those. And basically it's through the political process and the regulatory process,'' George continued. "Most people think that 'I don't have time for that'. Well, it's impacting our lives and people need to really, I think, educate themselves on what they can do and to try to mitigate the costs that are impacting us, but also to balance that with the reliability of service.''

George said improvements to the electric grid and infrastructure, such as the multimillion-dollar CapX 2020 power line project, are part of the cost.

"It's like anything else is that if you don't maintain it and you don't meet demand as we as consumers are putting more demand on, we have to actually upgrade and build new lines, upgrade the lines that are there. If you don't do that, then you don't have reliability, so when you want the power, it's not there. Looking to the future, I think people need to try to No. 1 educate themselves and No. 2 is balance affordability, reliability and environmental stewardship,'' he said.

Electricity isn't so reliable in places such as the Philippines and Guatemala, where George volunteers through the National Rural Electric Cooperative Association's International programs to improve the electricity infrastructure in Third World countries.

"It's not uncommon for those places that have electricity (that) they may have it for three to four hours a day and that's it,'' he said. "Reliability is a factor.''

After more than four decades in the business, George has seen many changes in the electric industry generally and in Kandiyohi Power Cooperative in particular.

Kandiyohi Power was started in 1936. By 1938, most of the lines were energized. Every customer received 40 kilowatt-hours of power at a cost of nine and a half cents per kilowatt-hour. Increases in usage and technological innovations reduced the cost to as low as four and half cents per kilowatt-hour. Today's cost is about 11 and a half cents per kilowatt-hour.

"So relatively speaking, it's still a good deal,'' George said. "When you look at what electricity does for us in our personal lives, in our businesses, it's a relatively inexpensive necessity.''

Customers have also changed. In the early years, customer-members were rural farm families. Today, customer-members are more diverse with different ideas.

"A lot of our members don't remember not having power like back in the early days,'' he said.

George first worked for 10 years as a journeyman lineman for a Colorado cooperative. He quit that job, went back to college and graduated from Mankato State University with a bachelor's degree in business administration.

Quitting the lineman job was a big decision because the pay was pretty good.

"But it was the best decision that I made,'' he said.

George began work in 1981 as a customer service manager for Agralite Electric Cooperative in Benson. On June 1, 1987, he started as CEO at Kandiyohi Power Cooperative and has been there ever since.

A noteworthy accomplishment during George's career is passage of a state law that allowed Kandiyohi Power Cooperative and Willmar Municipal Utilities to form a joint venture called Allied Power in 1997. Out of Allied Power came cable and Internet provider En-Tel Communications in 2000, which was owned by Allied Power and a group of four telephone companies and electric cooperatives.

"Prior to Allied Power and En-Tel coming, broadband and connectivity were not really being served well in this community,'' George said. "So I think by Allied Power starting into En-Tel, that jump-started infrastructure building within the city and I think that was good for the community.''

Another major highlight was approval of the landmark service territory agreement between Kandiyohi Power Cooperative and Willmar Municipal Utilities in October 2008. The agreement enabled Kandiyohi Power and Willmar Utilities to avoid costly territorial disputes and it provides for fair compensation to the co-op when the city acquires territory formerly served by the co-op.

"It was successful in the sense that we sat down and came up with a compensation system that made sense and that took the animosity out of trying to beat the other utility up because you're thinking you're not getting enough money or someone's paying too much,'' George said.

Also, the co-op made the strategic decision to diversify services to enhance revenue streams and provide valued-added services such as Heartland Security Services.

The new CEO is Scott Froemming, the co-op's chief financial officer. The board selected Froemming following interviews with candidates gleaned from an extensive nationwide search. Froemming has worked for the co-op for 10 years, is part of the management team, knows the culture and will provide for an orderly transition, George said.

Looking back, George said his successful career was made possible by the talents of many others, as well as his own. He's enjoyed leading the management team and working alongside the board in positioning the cooperative for the future and bringing visions to reality through the talents and dedication of the employees.

"It's been a challenging career. I'm going to miss it. I love the business. I enjoy going to work in the mornings. I enjoy the people. It's an exciting time in this industry. There's a lot of opportunity just for professional growth, but there's a lot of opportunity in what we do as a society with our energy policy. I envy those who are still here. But it's time for me to do something different and let someone else pick up the reins here.''

If you go:

What: An open house for David George's retirement as chief executive officer of Kandiyohi Power Cooperative in Spicer.

Where: Kandiyohi Power Cooperative, 8605 47th St. N.E. in Spicer

When: noon to 3 p.m. Jan. 30

 

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