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Wednesday, January 19, 2011

Cooperatives in Minnesota.

Attending a meeting at Connexus headquarters in Ramsey allowed a chance to read bylaws, something that few member-ratepayers ever do, and to learn that the distribution grid in the co-op's service area is not over subscribed or pressed, but that transmission from Great River Energy supply into the grid to where Connexus draws power is at capacity. The transmission grid is generally operated at or above original engineered capacity, nationwide, but the local distribution networks are generally not stress points. Connexus is a distribution operation, buying all its power wholesale from another co-op, Great River Energy, owned by its member co-ops, with each participating distribution co-op owning a share scaled to its consumption; not with each co-op being equal in voting power in the setting of genco policy ("genco" being the acronym for "generating company").

Connexus has been reliable as to outages; where storm outages and occasional flickering of lights causing the computer UPS to beep happen. However, outages have been addressed on a reasonable basis and I believe the firm's safety record is also top notch.

Trimming trees is a power company difficulty, but the family's experience has been that once the Connexus official is reached, a less than easy thing, he and others are accomodating and easy to work with.

A friend had a bad experience with entry on his land and tree cutting he deemed excessive, but after some time in dispute things settled amicably.

I was most surprised to see the firm, in an arbitrary and capricious manner, has moved to attemp to disenfranchise member-owner-ratepayers of some rights, if they have to end up litigating with the power monopoly - even if the homewoner wins or things are settled amicably.

An owner-member-ratepayer ostensibly cannot serve on the firm's board of directors if he or she had litigated with the monopoly within the last five years.

It seems such a person, if prevailing or amicably settling, would be an ideal board member, from experience. I can see no true rational basis for an otherwise rational company to impose such a roadblock against its owners. It seems unjust, unfair, and bogus.

I can see it as aimed at former Connexus CEO Rick Newland, still an owner-customer because of living in the monopoly service area, the litigation bar; but it is just too far reaching and not narrowly proscribed otherwise.

However, I think more than enough qualified people, some with power industry experience, exist to meaningfully fill board positions.

Clearly management and owner-ratepayers do NOT want just a rubber-stamp board, that would be a wrongful management motivation and a public relations negative; so I cannot figure out why the bylaws have been so jiggered up other than to shut out former CEO Newland.

Any reader with helpful information is invited to send an email to the sidebar email address.

And remember, the member-ratepayer-owners count on the firm's decency and competence, every day, as the firm well knows, per an early admission of such in a recent annual report:


As always, every day, you can click on the image to enlarge it to read. You can count on it.

_________UPDATE__________
I may be wrong about an expectation of fairness being every Connexus ratepayer-owner's expectation; but I doubt that. I ask readers to send email, whether they feel one way or the other. Were it not a firm holding monopoly power over an essential service while imposing a contract of adhesion (their demanded terms on a take it or leave it basis, where bargaining power is clearly unequal, and where the essential service is not otherwise available via other means), were that status not at play, then the situation might be different.

Ex-CEO Newland had an employment contract dispute which ended up not being amicably settled, nor with Newland prevailing. Clearly that is a different thing from a service related complaint where the firm first acts inamicably and with a deep pocket and heavy handed approach; but ultimately sees reason in amicably settling. To disenfranchise every owner-ratepayer of the monopoly whenever the firm is not amicable at the beginning of things is simply inexcusible overreaching - from a contract of adhesion position - and not what we'd rely on, every day. Or I would not, I'd want more decency and better attention to the people who "pay the freight."

If indeed, Newland and not every ratepayer-owner in the entire multi-county service area experiencing dispute were the target, the wording of the bylaw provision could exclude from the board "any former executive disputing contract carryover matters after a severance who does not either prevail in litigation or amicably settle with the firm." That would not be an overreach by a powerful monopolistic enterprise against all of its owner-member-ratepayers' rights.

Similarly, were regulation by the PUC an avenue for redress of excessiveness, an argument might exist where with cooperatives, (exempt by law from PUC oversight and regulation), things can be manipulated to be more arbitrary [even wholly so] without ameliorating bounds of administrative review and reform. Perhaps the answer is to petition the PUC to assume regulation over this cooperative, something the board could institute, if board members thought such a constraint wise.

Or am I barking up a wrong tree?

I just like justice and fairness, as well as undispted quality of service. There are two kinds of power at play. Electric power, no problem. Arbitrary political power exercises instituted by insiders, big time problem. Or that's at least my outsider's view of how Connexus management insiders have acted.

And again, it is not a private firm in the private sector making widgits you can buy or not; conjuring up something and putting it to a cleansing vote of voluntary shareholders able to freely hold or sell shares; it is a monopolist contract of adhesion at play where there is no alternative but to bow down or to go without electricity. Wholly, wholly different than with the widgit maker having shareholders who can dispose of a holding share, and be done with any/all arbitrariness. Wholly different.