The RPC White House Environmental Justice Advisory Council (WHEJAC) Public Comment

The White House Environmental Justice Advisory Council (WHEJAC) was established to advise the Chair of the Council of Environmental Quality (CEQ) and the newly established White House Environmental Justice Interagency Council (IAC) to increase the Federal Government’s efforts to address environmental injustice.

The following statement was submitted to WHEJAC on February 3rd, 2022:

Rural Electric Cooperatives (RECs) serve 42 million Americans and power 56% of the nation’s landmass. RECs cover 90% of counties federally-recognized for persistent poverty, yet the member-owners of those utilities face some of the highest energy burdens—percentage of income spent on energy bills—in the country. These counties include broad swaths of the Black Belt region, Appalachia, Tribal Lands, and the US border, where many economically-disadvantaged Americans live. For this reason, it is essential that the path to a lower carbon future does not drive electric cooperatives, or the communities that own them, further into debt. 

RECs directly own over 300 fossil fuel power plants in the United States, emitting over 130 million metric tons (mmt) of carbon pollution annually. Though they serve just over 12% of the U.S. population, RECs account for over 20% of all electrically-generated carbon emissions, with nine of the most carbon-intensive electric utilities in the US energy sector being owned by RECs. 

To meet the necessary goal of creating a carbon pollution-free power sector by 2035, the REC sector must retire these plants and replace them with carbon-free energy sources—and they must do so in just 14 years.

Without federal relief, the only way that RECs can finance clean energy investments is via new debt. Unfortunately, the REC sector already holds roughly $100 billion in debt, nearly half of which is financed directly by the federal government. To put this into context: East KY Power Cooperative owes the Rural Utility Service (RUS) more than $2.1 billion for energy infrastructure that needs to be retired. They carry daily debt service of $563,000. That’s an average of $29/month in debt service for every meter served. 

Electric cooperatives and member-owners have been at a historic disadvantage. Even in the face of insufficient energy infrastructure and devastating environmental impacts (like mountaintop removal coal mines and air and water pollution from coal plants) rural communities were last to get electricity to their homes. RECs have also been historically disadvantaged by federal incentives for clean energy, while their investor-owned counterparts have been able to leverage robust state and federal tax credits for proactive investments.

Without federal funding, these communities will be the last to transition to clean energy, or will be unable to decide their own clean energy futures, while outside companies buy up rural land for large scale solar projects, lining the pockets of out of state developers. Rural communities require an equitable and just energy transition that promotes local ownership and local wealth building. 

Federal investments in Rural America have been proven to be effective and necessary. The Rural Electrification Act of 1936 brought electrification to the countryside. As a result of this renowned New Deal program, electrification of rural areas (including homes and businesses) increased from 10% to 80% between 1936 and 1950. Unfortunately, the economics and social conditions have changed relatively little since the first power lines went up—some have even gotten worse. 

Today, faced with the economic and climate imperative to transition to a new energy system, rural communities will once again require major federal investment.

The Rural Power Coalition (RPC) represents the national movement for electric cooperative reform that is being led by member-owners and advocacy groups across the country. Specifically, the RPC is asking the White House Environmental Justice Advisory Council to recommend the Biden Administration:

• Ensure any debt relief to Rural Electric Cooperatives is conditional on new investment in local energy upgrades in rural communities on terms that are broadly inclusive. (It’s imperative that the benefits of federal support reach rural communities!)

• Ensure that Justice 40 recognizes and includes in its definition the counties that are already federally recognized for persistent poverty. These are counties that have had more than 20% of the population living below the federal poverty line for at least three census reports, or 30 years.

• Ensure that President Biden fulfills his pledge as a candidate to implement the 10-20-30 rule. This is a policy championed by Rep. Clyburn and Sen. Booker to assure that at least 10% of federally funded programs be directed toward persistent poverty communities.

• Ensure the Department of Energy actively participates in a whole-of-government response. The DOE has the capacity to work with every single Rural Electric Cooperative in the country to chart a technology transition path, but right now, it is helping very few. 

• Ensure meaningful engagement at a community level for every new application requesting federal financing from the Rural Utilities Service—and for every requested issuance of debt for the Tennessee Valley Authority.

• Treat electric cooperatives fairly in reform of renewable energy tax credits so that they receive the same vital option for direct payment that is afforded to most other utilities. 

Sincerely, 

Rural Power Coalition 2/3/22

Appalachian Voices (NC)

CURE (MN)

Kentuckians for the Commonwealth (KY)

Mountain Association (KY)

Partnership for Southern Equity (GA)

RENEW Missouri (MO)

Western Organization of Resource Councils (MT)