Consolidation Study Update – June 2012

WIEC & AEC Consolidation Study Update
by Jim Thompson PE General Manager

In March, members were informed of Adams Electric Cooperative (AEC) and Western Illinois Electrical Coop.’s (WIEC) discussions about the possibility of joining the two cooperatives. The goal is to gain efficiency of scale, share expertise, spread fixed costs, and be more rate competitive by reducing expenses. The first step is to determine if combining the two entities will be financially beneficial.  
    To make that determination, the financial data of both co-ops were sent to the National Rural Utilities Cooperative Finance Corporation (CFC). CFC is a member-owned, non-profit cooperative and provides financial assistance as well as operating loan funds for cooperatives across America, including WIEC and AEC. After studying the information, CFC will make an independent assessment as to whether or not it would be a good decision for the members of both coops to join. This analysis is just one step in making a long term decision for the success of both cooperatives. If there is a recommendation to consolidate, each board would analyze the conclusions drawn by CFC and determine what is best for all members and employees.
    Since the consolidation discussions began, AEC and WIEC have begun working together on several projects. An Okonite training seminar concerning underground cable installations and preparation was held at Adams Electric with both co-ops’ linecrews attending. The training provided an opportunity for operations employees to meet and start building relationships.
    Adams and WIEC are already finding opportunities where technology can benefit both cooperatives. Adams provided our mapping system capabilities to create maps for WIEC to share with the Illinois Dept. of Natural Resources (IDNR). Using technology over a greater member base allows technology to be more affordable for both memberships.
    Adams Electric’s engineer performed WIEC’s Work Order Certification, which is an examination of work order procedures for the past year required annually by CFC. In the past, WIEC would have to hire an outside engineering firm to perform this inspection. AEC, having professional engineers on staff, helped with this requirement. The ability to share employees and their experience between the two cooperatives allows both cooperatives to save money. These collaborations are just the beginning of many work processes that could provide benefits.
    Both boards will continue studying the long term merits of consolidation with the long term goal of keeping electricity reliable and affordable. We will keep our members updated concerning the consolidation study progress.   
    Our main focus, as always, will be doing what is best for the membership. If you have any questions or concerns at any time, please don’t hesitate to call, email or stop by.
    You can reach me at (217) 593-7701, (800) 232-4797 or