Power Play: Cherryland Electric serves up reliability, bill credits to its members
In 2003, Cherryland Electric Cooperative had a reputation that was the pits.
Its rates were high and reliability was terrible, says General Manager Tony Anderson, who was hired in March 2003 after the previous manager had been fired.
“At that time, our rates were almost 10-15% higher than Consumers Energy,” Anderson said. “Our reliability was terrible. We had employees who didn’t want to wear our logo in public. But then we started to turn that around.”
Today, Anderson says that Cherryland Electric’s power is 10% less costly than Consumers Energy and the company’s reputation is on the rise as it ushers in alternative energy and continues to build stronger relationships with its members.
“Our reputation for reliability is great and you see our logo all over now,” Anderson said. “We feel like we’ve made a big turnaround over the last 17 years.”
The general manager credits his 58 employees for making the Grawn-based nonprofit what it is today.
“There’s not a co-op in the country who serves more meters per employee than Cherryland,” said Anderson, whose team has been rated number one in that statistic for the last five years. “So, we feel like we’re running it very efficiently. And maybe 20 years ago, we weren’t here or there. But we’ve come a long way in the last 17 years.”
Cherryland Electric serves six counties — Leelanau, Grand Traverse, Benzie, Kalkaska, Wexford and Manistee — which includes 36,000 meters and 3,000 miles of line over 1,400 square miles of land.
Over the years, the nonprofit has seen exponential growth since it energized its first 300 miles of lines in 1939 for 60 members.
As a cooperative, Cherryland members receive a percentage of the profits. The rest is used as a zero interest loan for purchasing materials and equipment such as poles, wire and vehicles.
When Anderson first came to Cherryland Electric, the power supply was predominantly coal. Today the company is 62% carbon-free, with 20% from renewable energy and 42% from nuclear power.
Anderson says it’s something that his team is proud of.
“(W)hile other utilities are making goals to be 50% or 100% carbon-free by 2030 or 2050, we’re at 62%,” he said. “If not for one failed wind farm in the Thumb, we would be 80%, but we’re not. But we are striving to get there.”
In the next 10 to 15 years, Anderson says he expects Cherryland to be 80-85% carbon-free.
In 2013, the first community solar project was completed by Cherryland Electric, which sits in front of its Grawn facility.
Other innovations have improved Cherryland’s reputation. Between 2006 and 2008, its meters were automated, allowing the company to read or disconnect a meter from its office. It also has distribution automation, which allows remote control of breakers in the substation.
“That’s something people don’t really see,” Anderson said. “But when you put all of that together, our reliability last year was 99.986. So far this year, we’re at 99.987.”
In a state with heavy weather and active squirrels, getting to 100% reliability is not “realistic for any utility in Michigan,” he said.
“But we’re striving to get to (99.99), which is hard to do,” he said. “We talk about four nines around here a lot. It is kind of boring to the average person, but it translates into a good reputation around the community.”
Keeping lines active and open is not only good for business, it is also how Anderson treats member communication. Anderson hosts the country’s first electric co-op podcast, now in its fifth year. He also writes a blog so that readers can interact with him about various issues related to energy.
The engagement, says Rachel Johnson, the co-op’s member relations manager, is “unique” in the industry.
“We have a general manager who is willing to engage directly with our consumer members,” said Johnson. “The fact that a member can come on our blog and ask a question – and it’s not the P.R. person answering that question – goes a long way to build trust.”
Cherryland Electric says it has more than 20,000 e-mail addresses that it sends a monthly newsletter and magazine to as well. The podcast has about 3,000 listeners a year and has even helped Cherryland secure partial funding for its community solar project.
“Somebody down in the state Department of Energy was listening to our podcast and they wanted to do this low-end, low-income solar pilot,” Anderson said. “They called us up and said, ‘We’ve got $80,000 to put toward a low income solar project.’ We had to put in $160,000, but that’s $80,000 we wouldn’t have had without that podcast.”
Jim MacInnes, the CEO of Crystal Mountain Resort, has been a guest on the podcast talking about electric vehicles. The resort is the biggest client of Cherryland Electric and encourages its guests to drive electric vehicles. The resort has five charging stations.
“We have worked with (Cherryland) for many years; they’ve been very reliable,” said MacInnes, who has been at Crystal Mountain for 35 years and is a licensed electrical engineer. “They are a very progressive co-op. The more we can electrify our resort, the more opportunity we have to use clean energy to power our business.”
Over the years, Crystal Mountain has taken advantage of various grants offered by the co-op. In 2012, with the help of Cherryland, the resort replaced 300 incandescent lights with LED bulbs in its 33,000 square-foot conference facility.
“By doing that, we were able to save about 75,000 kilowatt hours a year, which is enough to power a Chevy Volt over 200,000 miles a year,” MacInnes said. “That’s one of the low-hanging fruits.”
Electric vehicles are a win-win for Cherryland Electric, which help boost usage without much investment, but remain environmentally friendly. The utility recently put in a level-three electric car charger at Blain’s Farm and Fleet in Traverse City. It is the first charger of its kind north of M-72, Anderson said.
“This can charge any new electric vehicle on the market,” Johnson said.
The utility company encourages its members to buy electric cars through rebates. Since 2018, Cherryland has given 17 rebates to members for purchasing an electric vehicle and 25 rebates for installing level-two chargers.
At Cherryland’s offices in Grawn, the company has two electric cars — a Chevy Bolt and a Telsa Model Three — that are available for the employees to use and for promotional purposes. Members are welcome to test drive them too.
“We are just trying to lead with that technology and use it on a daily basis,” Anderson said. “As soon as the first truck comes out that’s electric, we’ll get one of those as well.”
During the pandemic, Cherryland Electric responded like many other businesses by shutting its doors and sending home employees. Some of the 58-employee workforce is working from home and others are spaced out throughout the Grawn facility.
“I can say managing a remote workforce is not what I want to do. So I’m ready for the pandemic to be over,” Anderson said. “But when you have good people, it just works. And we made that transition seamlessly and are proud of how that’s worked.”
As far as revenue during the pandemic, Cherryland has fared well, even though some of its biggest clients like Crystal Mountain, Great Wolf Lodge and Turtle Creek Casino dropped usage as much as 50% at the start of the pandemic. However, about 95% of Cherryland’s customers are residential and were stuck at home during the pandemic using energy at record levels.
The surge in usage created a profit, $2.5 million of which was disbursed back to members in October.
“Our profits went way over budget and way over what we expected,” he said. “It’s going to be close to a record-breaking usage year for our residential customers.”
In addition, the utility has given out more than $550,000 in grants to local nonprofit charities through its Cherryland Cares Grant program. The program is funded through members rounding up their bills.
As of December 2020, the co-op will have given back $28 million to its members in the past 11 years.
“That’s cash money back to our members, which we weren’t doing 15 years ago,” said Anderson, who plans on crediting another $3 million to Cherryland members in December.
The cooperative receives its power from Wolverine Power Supply, a generation and transmission cooperative in Cadillac.
Anderson said the reliable power source has enabled the utility company to keep rates low. In fact, Cherryland Electric has only had two rate increases in the past 10 years, with the most recent in April 2018, according to Anderson.
The general manager explained that power supply is 70 cents of every dollar that Cherryland Electric spends, leaving the remaining 30 cents to manage the cooperative.
“Power supply is a big deal to us,” Anderson said. “Wolverine does a great job of keeping it affordable, while keeping it clean. No other utility in the state of Michigan has a power supply portfolio as clean as ours.
“They all have goals that want to be where we’re at, but they’re not where we’re at.”
Cherryland Electric’s biggest members
Leelanau Fruit Company
Turtle Creek Casino
Great Wolf Lodge
Traverse City Area Public Schools
Auto Owners Insurance
Copper Ridge Surgery Center
Grand Traverse Bay YMCA