On Wednesday, March 6, Tipmont’s CEO, Ron Holcomb, spoke at a Capitol Hill briefing today on Tipmont’s efforts as part of the nationwide economic development impact of electric cooperatives. Following are the remarks he delivered.
Co-ops are essential to rural communities. And this new report does a great job of outlining that through statistics and numbers. I want to go beyond that and talk about how Tipmont empowers and supports the local economy in west-central Indiana.
Tipmont REMC serves 23,000 consumers around the cities of Lafayette, West Lafayette and Purdue University. We have 94 employees supporting both electric and Broadband services.
Five years ago, Tipmont’s board of directors and leadership began an initiative to rethink the co-op’s mission and purpose. In a time of rapid change or even disruption in the energy business, the time was right for some soul searching. The result? – We concluded that we are in the security, comfort, and convenience business – not necessarily the electric business. Are you surprised? You see, providing electricity is what we do and, of course, it is essential. But it doesn’t explain why. The real question was – How are our consumers doing? How are our communities doing? Is their standard of living on the rise? Do they have access to the tools they need to succeed? Can they compete? We began to measure our success in terms of our community’s economic health, in addition to more traditional measures. Of course, electricity is vital to our security, comfort and convenience – but is that where we stop? Is that enough?
Our work concluded with a new mission statement that read: “Empowering our communities with state-of-the-art essential services.” This mission reflects how Tipmont’s role is larger than simply providing distributed electric services. Instead, our purpose is to provide the tools our consumers need to be successful so they, in turn, can pursue the security, comfort, and convenience we all desire. Further, the services Tipmont provides must be state-of-the-art. Simply put, we believe services in rural Indiana should be, and will be, the best available anywhere.
Our new mission allowed us to reimagine nearly everything we do. It encourages Tipmont to take a leadership role beyond just the consumers we serve, making meaningful and positive change through economic development efforts, education and outreach.
For example, our two community grant programs have contributed over $1.7 million back to our communities. Our EnviroWatts grant program funds environmental and alternative energy programs. Tipmont consumers elect to pay a small premium on their electric bill to fund the program. A volunteer board of Tipmont consumers then distributes grants to not-for-profit organizations in the Tipmont service area. Since 2003, EnviroWatts has contributed over $700,000 in community grants.
Our Operation Round Up program has contributed over $1 Million dollars back to the communities we serve. The program is simple: our consumers choose to round up their monthly electric bills to the nearest dollar. The extra change is placed into a trust fund that distributes grants to local non-profits.
These grants have funded:
- community service projects
- economic development
- food banks
- health and rescue organizations
- educational projects, and
- youth programs
In 2015, Tipmont built the first Community Solar array in Indiana, recognizing that consumer choice in energy technology is an emerging trend that is here to stay.
That same year, we began building fiber-optic lines to connect each of our substations. Fiber connectivity allows us to leverage leading edge technologies, including real-time distribution system command and control, which helps us respond more efficiently to electric outages when they occur. Secure high-speed connectivity is also a crucial infrastructure to support new and emerging distributed-energy-resource technologies. In short, our investment in fiber was an investment in our community – to ensure system reliability and to optimize consumer choice and preferences.
As we were connecting fiber to our substations, we asked our consumers if their economic opportunities, quality of life and ability to compete were hampered due to inadequate Broadband services – and if they were interested in Tipmont providing a state-of-the-art Broadband solution. The answer was a resounding yes! At the time, we had a pretty good idea of the impact inadequate Broadband had on individual consumers, but what would this potential fiber investment yield on a measurable economic basis?
To help answer that question, Tipmont engaged Purdue University economists to help us understand how delivering broadband today would impact our community over the next 20 years. Purdue’s economic analysis found that a broadband investment would yield $500 million of new economic benefit over two decades – That’s nearly $4 returned for every $1 invested. Additional federal and state tax proceeds or tax savings accounted for $140 million of the net economic benefit. To drive this point home, the tax benefits of the project alone exceed the cost of the entire project to bring broadband service to 23,000 consumers.
Over $400 million in benefits are attributed to our local economy. These benefits touch a wide range of areas including:
- Increased entrepreneurship and business startup activities;
- Increased access to distance-education options that would allow communities to improve job skills and compete for higher paying jobs:
- Savings on telemedicine healthcare that would reduce the costs of the Medicaid and Medicare programs.
This study was shared with state legislators and played a key role in Governor Holcomb’s recently announced $100 million investment to expand high-speed Internet in rural Indiana.
While the economic statistics are compelling, it’s the stories we hear from our consumers that are a call to action. We’ve heard from students that face a “homework gap” where they have access to technology at school, but not at home – so they’re forced to drive 30 minutes to a McDonald’s or Starbucks to complete their homework.
We’ve heard from home business owners who estimate a loss of up to 75% of productivity as they try to run modern applications and video communications over ancient copper lines that were only intended for analog voice signals.
And, we’ve heard from physicians unable to take advantage of advancements in telemedicine that would allow them to provide specialty care to small, rural hospitals.
All of these stories share a common theme that we call fundamental fairness. It’s the simple idea that all Americans should have access to the same essential services regardless of where they live. And, that rural essential services should be equal in quality to essential services anywhere in the US.
In January of 2018, Tipmont’s board of directors authorized the construction of a $100 million high-speed Broadband project to deliver symmetrical gigabit service to our consumers. From listening to our consumers and engaging preeminent scholars, we know that this service will be as transformative for our entire community as the delivery of electric service was in the 1930s.
When we made this decision to offer fiber Internet, we began looking for ways to improve our performance and accelerate our deployment. That search yielded a solution that will benefit every consumer of our community. This past December, Tipmont announced the acquisition of Wintek Corporation, a Lafayette, IN fiber and technology solutions provider specializing in advanced commercial enterprise solutions including high-speed connectivity, data storage, and consulting.
We also developed a strong partnership with Mulberry Telecommunications, a local telephone cooperative to deliver linear video and voice services to our consumers. Their expertise and guidance have been an invaluable asset.
Tipmont is poised to take advantage of emerging energy services. We are rolling out essential broadband infrastructure. We seek opportunities to accelerate the positive impact we have on our community through acquisitions and partnerships.
The economic impact Tipmont and our rural cooperatives have on rural America is unquestionable. Our tools may evolve from distributed electricity to networked energy services. Our tools may expand to include broadband and perhaps other essential services. But our mission of community success never changes.
