History of Poudre Valley REA

Until 1935, much of rural America survived without electricity. It was in that year that President Franklin D. Roosevelt issued an executive order establishing the Rural Electrification Administration (REA). The U.S. Congress, in 1936, enacted the Rural Electrification Act promoting the establishment of member-owned cooperatives as the means by which service could be provided in rural areas. Farmers, ranchers, and others living in these areas banded together all across the country to bring the convenience of electricity to their lives. It was the Rural Electrification Act of 1936 which enabled Poudre Valley REA, along with 22 other REA’s in Colorado, to begin.

Poudre Valley REA was the subject of discussion with farmers living in Larimer and Weld Counties back in 1939. After several informal meetings had been held, two larger meetings of potential members were organized. At these meetings the project was tentatively approved, and between May 11 and September 11, 1939, over 600 interested parties paid $5 apiece for membership to Poudre Valley REA. The Articles of Incorporation were signed by 11 incorporators on October 7, 1939, and the first formal meeting of the co-op was held November 2, 1939. An office was established in the town of Severance, Colorado. A loan application was filed with the REA in Washington, D.C. and the approved loan allowed Poudre Valley to construct 229 miles of line to serve 560 families in Larimer and Weld counties. The first stake was driven on the Carl Bokelman farm 2 miles south of Kelim, Colorado. By September of 1940, these first few miles of line were energized.

Electric cooperatives are owned by the people who receive the service. These member/owners, through the democratic process of “1 member, 1 vote,” conduct an annual meeting to elect their board of directors. The board in turn sets policies and hires a manager to implement these policies. The key to Poudre Valley REA’s success is this annual meeting of members and the active participation in the voting process by the members. In this respect, things are no different today than they were back on September 30, 1940 when the first annual meeting and energization celebration took place. By September 29, 1941, the date of the second annual meeting, Poudre Valley REA had grown to 1,252 members. Mr. C. L. Bass of Pierce, Colorado, had an amazing record for kilowatt-hour usage for August 1941—447 Kilowatt house! An integral aspect of Poudre Valley REA is that unlike investor-owned utilities, it is a non-profit organization and, unlike municipal utilities, has never been compelled to subsidize public projects. Instead, Poudre Valley REA reimburses its member/owners any margins above and beyond the cost of power and the cost of operation. These reimbursements are called “capital credits” and are paid back to the member/owners on a 10-year revolving basis.

Since those early days, Poudre Valley REA has grown, changed, and adapted to meet the needs of its members. For instance, it was with a great deal of controversy that in 1942 the office was moved from Severance to Fort Collins. That dispute was finally resolved in the courts. The service area, so small at first, now covers 2,000 square miles in Larimer, Weld and Boulder counties. Most of the farms and ranches east of the foothills were being served in the 1940s. The majority of electric lines serving Rist Canyon, Poudre Canyon, and the Red Feather lakes area were completed by the late 1950s. The ‘60s and ‘70s witnessed unparallel growth throughout the system as our Rocky Mountain Region became one of the most desirable regions in the country in which to live and retire. New industry has brought a booming prosperity—a prosperity welcomed by Poudre Valley REA in light of the fact that the last low-interest loan the Association was able to secure was in 1972. Since that time, loans have been obtained at much higher rates.

Much of Poudre Valley REA’s history has been made in controversy and litigation with other utilities. For instance, the state legislature passed a law in 1961 which required electric utilities to come under the jurisdiction of the Public Utility Commission (P.U.C.) of the State of Colorado. Among other things, the law granted the P.U.C. the right to set service boundaries. Municipalities serving within their city limits were not covered by this law. Territorial disputes arose among Poudre Valley REA, Public Service Company of Colorado, Home Light and Power Company, and other neighboring utilities concerning who had service rights to certain areas. Construction and work schedules were affected by these disputes. After many hearings at the P.U.C. and negotiations between utilities, definite territorial boundaries were established and decisions handed down by the P.U.C. Although most of the territory problems were resolved by these decisions, several court battles ensued before territory disputes were settled. Due to the rapid growth throughout the ‘70s, another question arose. What happens if municipalities annex within Poudre Valley REA’s territory? Annexation agreements with the cities of Loveland, Longmont and Fort Collins were reached in the early ‘80s. These agreements spelled out what services and service rights were to be transferred within those annexed areas.

In 1980, the City of Greeley, which is served by Home Light and Power Company, annexed an area already served by Poudre Valley REA. As a result of this annexation, Home Light and Power, through its franchise from the City of Greeley, contended that they had the service rights to Poudre Valley’s territory if it was annexed into the City. In July of 1985, the District Court of Weld County ruled in Poudre Valley’s favor. The rural electric cooperatives in Colorado sought and were able to obtain a law allowing the rural electrics to be deregulated from the P.U.C. for certain portions of their businesses in 1983. The P.U.C. regulation was both time-consuming and expensive. Rules and regulations sought or imposed by the P.U.C. were not always in the best interest of Poudre Valley REA and its members. The Deregulation Bill required each rural electric’s membership to vote on the issue of whether or not the system was to be deregulated. Poudre Valley REA’s membership voted overwhelmingly for deregulation.

On September 11, 1995 Poudre Valley REA broke ground for a new site east of I-25 off the Windsor exit. The new site was not only strategic move for the Poudre Valley REA but a much needed one. The new facility moved headquarters away from the city of Ft. Collins and back to a rural setting. The location was chosen based on service area. Being able to access any of Poudre Valley REA’s service territory from a central location that offered easy access in any direction. The headquarters boasts state of the art technology along with room for expanding.
Through the 1970s, 1980s and 1990s Poudre Valley REA had steady growth, with Kodak leading the way as our largest consumer at 25 Megawatts. From 2000 to the present Poudre Valley REA has had tremendous growth in residential, commercial and industrial consumers with the OI (Owens Illinois) bottling plant and the newly constructed Front Range Energy ethanol plant, both based in Windsor Colorado, contributing to the largest load in the last two years in demand.

Poudre Valley REA will play a big role in the Rockies Express Pipeline project. The pipeline system is a route of the natural gas pipelines that will come from the Wamsutter Hub in Sweetwater County, Wyoming, and will continue on to the Cheyenne Hub in Weld County. Construction on the 192-mile portion from Wamsutter Wyoming to Weld County began in July 2006. It is expected to be in service by January 2007. To run this project Poudre Valley REA has designed and built the Owl Creek substation several miles north of the Rockport Substation. The new 66 Megawatt station will help the pipeline to continue its flow of natural gas through the area and on to Audrain County, Montana. Although the Owl Creek substation total capacity is 66MW the load on the substation will be 30MW.

Today Poudre Valley REA covers2,000 square miles of service territory and over 3600 miles of overhead, underground and transmission line combined. Regardless of growth Poudre Valley REA still provides the same high standards and sound energy that all consumers have come to rely upon. It is unlikely that any of the men who attended the organizational meetings in 1939 envisioned the tremendous success that Poudre Valley REA has attained. But it is those men to whom we owe the spirit and continuing success of the cooperative.