In July 1935, a group of utility company executives published a report stating that, based on their extensive research, there were very few farms needing electricity for major operations that were not already being served.
They were wrong by roughly nine out of ten.
As late as the mid-1930s, nine in ten rural American homes had no electric service at all. Farmers milked by hand under kerosene lanterns. Their wives worked wood ranges and washboards. Factories and businesses located in cities, because that was where the power was, which meant rural economies stayed locked in agriculture whether they wanted to or not.
The power companies knew. They had simply concluded that stringing line to sparsely populated areas would not turn a profit, and so they did not.
The workaround
If the companies will not build it, the people who need it build it themselves.
Franklin Roosevelt signed Executive Order No. 7037 on May 11, 1935, creating the Rural Electrification Administration. The Rural Electrification Act followed a year later, and with it a federal lending program that let local groups borrow money to build their own lines and run them on a nonprofit basis.
Wake Electric was organized as a cooperative in 1940.
The results across the country were dramatic. In the four years after the war ended, the number of rural electric systems doubled, the number of connected consumers more than tripled, and the miles of energized line grew more than fivefold. By 1953, more than 90 percent of American farms had electricity. Today roughly 99 percent do, most of it delivered by locally owned cooperatives that started by borrowing from the REA.
What member-owned actually means
This is the part most people who pay a Wake Electric bill have never thought about.
You are not a customer. You are an owner.
Wake Electric operates on the Seven Cooperative Principles, and three of them have direct financial consequences for the people it serves.
Democratic member control. The cooperative is governed by a nine-member Board of Directors representing geographic districts across the service area. Directors are elected at-large to rotating three-year terms at the annual meeting. One member, one vote, regardless of how much electricity you use. A member with a small house has the same vote as an industrial account.
Members’ economic participation. A cooperative returns its margins to its patrons. Any profit gets credited to each member’s capital credit account, with your share based on what you paid in that year and the co-op’s total margins. Those credits get retained as operating capital for a number of years, which reduces how much the co-op has to borrow, and then they get paid out to everyone who was a member in a given year. Members receive an annual notice showing what was credited.
Read that again. A profit-making utility sends its margins to shareholders. A cooperative sends them back to the people who bought the power.
Concern for community. The seventh principle commits the co-op to improving quality of life in its service area, and this is where the programs live.
The programs
Bright Ideas grants put up to $3,000 in the hands of local educators for classroom technology. Wake Electric visited Franklinton High School to talk with students using podcasting equipment bought with one of those grants.
There are college scholarships, classroom technology awards for teachers, and the Cooperative All-Stars sports camp scholarships, which sent two local middle schoolers to camp this past summer.
The Washington D.C. Youth Tour takes students to the capital.
Operation RoundUp lets members round their bill up to the next dollar, with the difference funding local assistance. The WECare Foundation makes grants. There is a Giving Fence and Giving Library.
None of this is corporate philanthropy in the usual sense, because there are no outside shareholders whose money is being spent. It is members funding programs in their own community.
The scale now
Wake Electric serves approximately 60,000 members across Durham, Franklin, Granville, Johnston, Nash, Vance, and Wake counties.
The customer service center is in downtown Wake Forest at 100 South Franklin Street. Engineering and Operations sit at 228 Park Avenue in Youngsville.
Part of the territory is still rural. Much of it is not. As Raleigh-Durham and the Research Triangle expanded outward, land that was farmland in 1940 became subdivisions, and a cooperative built to bring power to people the utilities would not serve now serves a fast-growing suburb.
That is an unusual institutional trajectory. Most organizations founded to solve a specific problem either dissolve when the problem is solved or drift into something unrecognizable. Wake Electric kept the governance structure and grew into a different landscape.
Eighty-five years on
The co-op is currently rolling out newer things, including a video podcast called The Co-op Current and programs for solar, renewable energy credits, and electric vehicle charging.
But the structure has not changed since 1940. The board is still elected by members. The margins still come back as capital credits. The vote is still one per member.
A group of farmers who could not get anyone to run wire to their houses built a utility instead. It is still here, and it is still theirs.
Wake Electric, 100 S. Franklin Street, Wake Forest. wemc.com