The Story of Electric Co-Ops

Want to learn more about the cooperative model? Watch this short video guide to the history, structure, and purpose of rural electric cooperatives. It was created by the National Rural Electric Cooperative Association (NRECA).

The seven cooperative principles are what set cooperatives apart from other power distributors.

1 Voluntary and Open Membership

Cooperatives are voluntary organizations, open to all people able to use its services and willing to accept the responsibilities of membership, without gender, social, racial, political or religious discrimination.

2 Democratic Member Control

Cooperatives are democratic organizations controlled by their members—those who buy the goods or use the services of the cooperative—who actively participate in setting policies and making decisions.

3 Members’ Economic Participation

Members contribute equally to, and democratically control, the capital of the cooperative. This benefits members in proportion to the business they conduct with the cooperative rather than on the capital invested.

4 Autonomy and Independence

Cooperatives are autonomous, self-help organizations controlled by their members. If the co-op enters into agreements with other organizations or raises capital from external sources, it is done so based on terms that ensure democratic control by the members and maintains the cooperative’s autonomy.

5 Education, Training and Information

Cooperatives provide education and training for members, elected representatives, managers and employees so they can contribute effectively to the development of their cooperative. Members also inform the general public about the nature and benefits of cooperatives.

6 Cooperation Among Cooperatives

Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional and international structures.

7 Concern for Community

While focusing on member needs, cooperatives work for the sustainable development of communities through policies and programs accepted by the members.

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Membership

By applying for electric service from CEMC, and by the payment of a membership fee, you are now a member/owner of the cooperative. You join more than 110,000 members who share CEMC ownership in our five-county area. Our website and social media pages provide information about our services, energy tips, and much more. We also encourage you to read the monthly consumer publication, The Tennessee Magazine.

On behalf of our board of directors and employees, welcome to Cumberland Electric Membership Corporation.

Cooperative FAQs

Helpful information about your cooperative.

The Cooperative’s members elect a Board of Directors to represent them in setting policy, approving the budget, and overseeing the strategic direction of the cooperative. They have a fiduciary responsibility to the members, including rate action approval. Additionally, the Tennessee Valley Authority (TVA) serves as the cooperative’s regulator.

The General Manager is the employee of the board and serves to execute the policies of the cooperative. As the leader of the organization, he or she employs a team to perform the purpose, vision and mission of the cooperative.

The staff and board of the cooperative exist to serve the members.  The members are the consumers of the cooperative’s product – electricity – but they also receive the other benefits of the cooperative business model. These benefits, which are summed up in the Seven Cooperative Principles, include democratic control, education and training, and community impact.

As a democratically-run, member-owned cooperative, CEMC is committed to operating transparently. Members have the opportunity to engage with CEMC leadership to express any concerns in multiple venues ranging from online community forums and our annual meeting to walking in the office or picking up the phone.

For members wishing to address the board, there is a process to go through and our staff can assist you with this request. In the spirit of member satisfaction, CEMC management will work to address member concerns before they rise to a level that would require board intervention.

Board members do not receive a salary, but they are compensated for their time, effort and expenses. Serving on the CEMC board of directors requires a substantial commitment. The board of directors are required to review, analyze, train and engage. As representatives of the membership, they set policy and approve multi-million dollar decisions, requiring numerous hours of attention and engagement per month.

Though CEMC is a private company, the cooperative annually submits a publicly available tax form that shows compensation, as well as other important financial information about the cooperative. It is called the IRS (Internal Revenue Service) Form 990.

Part VII of Form 990 lists compensation for current and former directors and key employees. Part VII, Column D lists W2 income for employees and regular monthly payments for directors (It may also include taxable lump-sum payouts of retirement plans for retiring employees). Part VII, Column F lists other benefits such as insurance and retirement benefits, which are not take-home pay. Also included there is the annual change in value of retirement accounts. For example, on a year when the stock market performs well, or interest rates change, this number can be significant; however, this does not represent money paid to the employee, but rather a change in the value of their retirement account for the year.

The board members are not employees of the cooperative, but they are compensated for a measure of their time and expense. Their compensation is set using thorough market analysis and data. One subset of that data is the compensation of board directors at one of the largest electric cooperatives in the United States.  

The role of General Manager (GM) at CEMC is one of the most critical jobs in this area, as CEMC is responsible for providing electric power to more than 106,000 people, vital public infrastructure, and diverse businesses throughout five counties. The GM’s salary is set using thorough market analysis and data. Local, regional and national data is used to ensure the cooperative is able to provide competitive compensation to attract and retain a leader of the highest caliber.

A standardized employment and compensation process has been specifically designed to identify the fair market value of each position, promote fairness, and eliminate potential bias in employee compensation. The intent of many organizations, and certainly CEMC, is to attract and retain high-quality employees committed to serving the membership at a high level.