Six Reasons Utilities Energize Economic Development and Make Great Partners
8 Jan 2018
By Golden Shovel Agency
We live in a connected world where everything is related. This connectivity is especially true in the economic development industry where relationships are critical to the success of community growth and economic development projects. Assembling a robust group of economic partners and advisors to help secure an economic development project is one of the first steps towards success. And, one important partner must be the local utility company.
Utility companies are dependent on community success and their growth and survival are directly tied to increasing electric power consumption levels making them a motivated and natural best-fit partner for projects.
Dave Gruenes, CEO of Stearns Electric Association in St. Cloud, MN, understands the important relationship between utility companies and communities, “If communities are strong and vibrant, our service territory grows, the co-op benefits from that. If communities are dying or not doing well, we’re not doing well. There’s an alignment of interests there that we need to help grow our region.” (Great River Energy, 2017).
The City of St. Cloud, MN partnered with Stearns Electric to acquire and construct the I-94 Business Park. This 500-acre, publicly owned park sits along I-94 in Stearns County.
The park currently houses six companies and ready to accept more business growth. The alliance between the city of St. Cloud and Stearns Electric attracts new companies. This economic partnership has generated incentives from local financial partners and the Minnesota Department of Employment and Economic Development.
“Stearns Electric has worked with companies in the park on utility and conservation measures. Incentives are available for those that build with energy efficiency in mind.” (Great River Energy, 2017)
Positive Public Relations
Economic development requires strategic marketing and effective public relations. Utility companies have the resources and experience to assist communities with direct marketing efforts and community public relations. Moreover, utility companies desire a positive,
cooperative relationship with the people who use their electricity, and they have staff who are equipped to promote a successful economic project.
The expansion of renewable energy, led by utility companies, is creating the perfect opportunity to attract new companies interested in taking advantage of green energy policies. Companies who take advantage of clean energy and who use energy efficient equipment and practices will find utility companies to be eager partners.
New business development or expansion can be an involved and technical process. Infrastructure, regulations and execution can be daunting to small business owners or to businesses unfamiliar with the local and state rules. By engaging the utility company early in the relationship, many of the early hurdles can be avoided. Not only can the utility company assist with electrical planning they can assist with the overall project planning by consulting on the project.
Utility companies are familiar with business expansion projects and they have worked through multiple projects interacting with the local governments. This expertise can be leveraged to help business owners quickly navigate bureaucracy--which speeds up projects.
Operating in Wyoming, the Powder River Energy Corporation has a diverse portfolio of members ranging from large coal mines and coal bed methane to farm, ranch and residential meters over 15,550 square miles. This large service area encompasses multiple communities and makes them a natural regional economic development partner.
For the last couple decades, government entities and nonprofit partnerships have attempted to leverage regional economic development planning. However, competing community interest and shared workforces can make regional economic development a political juggernaut. Cooperatives, like Powder River Energy, span across multiple political boundaries and are a natural broker in regional economic development
Industry Focused Economic Development
The end goal of any utility company is to sell the generated electricity and to be a positive community partner. Therefore, utility companies are naturally motivated to locate manufacturing companies that will have a steady, healthy demand for power.
Great River Energy in Maple Grove Minnesota is a leader in data center site selection services and was the first in Minnesota to develop a site assessment program specifically for data center development. Their expertise, combined with one of the most aggressive state incentive programs, provides increased speed-to-market and long-term operational savings for data center attraction.
This power cooperative understands that strategic, focused industry specific economic development has a higher probability of success. Additionally, when the power company focuses on a special industry like aerospace, automotive part manufacturing or data centers the surrounding communities can help follow the economic development script.
Project-Level Funding and Incentive Plans
Utility-driven economic development groups are well-funded and have the ability to employ strategic, successful marketing campaigns. These utility groups are able to tap into talented, experienced team members who can assemble and execute ambitious marketing plans.
Utility companies also have access to a government relations team and finance experts who can pull together attractive incentive programs. These incentive programs, when backed by state-level politicians, become incredibly powerful.
One example is the Tennessee Valley Authority's involvement in restoring a coal plant for a Google data center in Alabama. This project generated $600 million in capital investment in an area were job loss was draining the area. Bu pulling the project together and relocating workers, the area scored a major economic development win. (Utility Companies: Powerful Economic Development Partners, 2017).