Cooperative Living February 2018 - 25

YourBusiness | by Cammie Tutwiler, Contributing Columnist
Understanding Your Co-op's Boundary Lines
Electric cooperatives were
created in the 1920s and
1930s to bring electricity to
rural areas of Virginia,
reaching areas where
investor-owned electric
companies did not extend
service. In general, those
basic geographic boundary
lines still exist today.
H
ave you ever wondered why you
receive electricity from your electric
cooperative and not another electric
utility provider? Or why you receive
electricity from a co-op but someone who
lives around the corner doesn't?
These " territories " are a result of a basic
regulatory compact that has existed since
the introduction of electric service in the
early 1900s, according to Ken Schrad,
director of division of information
resources for the State Corporation
Commission (SCC).
" An electric utility company or an
electric cooperative (or a municipal electric
system) is permitted the exclusive right to
provide electric service in a defined
geographic area, " he said. " In return,
the utility has the obligation to provide
service to any customer willing to pay the
regulated rate established by the SCC. "
Electricity distribution is a service
provided with a regulated rate to ensure
that the price paid by customers is " just
and reasonable. "
" The capital-intensive nature of
providing electric service makes it logical
to be a regulated monopoly, " Schrad said.
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" It simply does not make economic sense
to have multiple companies putting up
electric facilities to serve customers on a
competing basis. "
Electric cooperatives were created in
the 1920s and 1930s to bring electricity to
rural areas of Virginia, reaching areas where
investor-owned electric companies did not
extend service. In general, those basic
geographic boundary lines still exist today.
However, that does not mean that
boundaries never change. Schrad said
that occasionally the Commission
receives applications to amend serviceterritory
certificates.
" If one company is not willing to
surrender its existing service territory to
another electric-service-distribution
company, the matter becomes much
more complicated, " he said. " Someone
would have to prove to the Commission
that the existing utility is not providing
adequate and/or reliable service. And, even
before making such a finding, the utility
would have the opportunity to correct
any issue regarding the quality of service
being provided. "
There are also instances when boundary
changes occur with no dispute. In these
cases, paperwork is filed with the SCC
from the parties involved, and after review,
the SCC issues an " order for revision of
certificate, " which adjusts the boundary line.
Recent examples of this kind of
boundary change occurred in 2008, when
Delmarva Power sold its service area in
Virginia's portion of the Eastern Shore to
A&N Electric Cooperative, and in 2010,
when the SCC approved the transfer of
the service territory of Allegheny Power
(legally named as The Potomac Edison
Company in Virginia) to Shenandoah Valley
and Rappahannock electric cooperatives.
Not only did the service areas of all
three electric cooperatives grow
substantially, but these new memberowners
began receiving Cooperative Living
magazine to stay informed about their
member cooperative. 
Cammie Tutwiler is a public relations representative
for Shenandoah Valley Electric Cooperative, a notfor-profit
member-owned energy provider that serves
more than 90,000 homes, farms and businesses in
the northern Shenandoah Valley. For more
information, go to www.svec.coop.
February 2018 | Cooperative Living | 23
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Cooperative Living February 2018

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