A Successful 2015-2016 Year at PEC Capped Off by Exemplary Annual Meeting

PEC held its Annual Membership Meeting at the Performing Arts Center of Dripping Springs High School this past Saturday. More than 600 members came from across the PEC service territory to vote in the 2016 Board Director elections; peruse employee exhibits; enter drawings for door prizes; hear about the status of their co-op from PEC CEO John Hewa; and snag some breakfast tacos and snow cones while they were at it. For the past eight years, Directors and Employees alike have been working hard to recover from the damage we incurred under past leadership. Finally, at this year’s meeting, both member and PEC employee alike felt as if the familial quality we lost in those darker days had been regained. Members were proud of their linemen. Employees were excited to greet their members and answer questions about their electric service. Member comments were resoundingly positive, and Board Directors were ready to hear member suggestions and constructive criticisms in hopes of identifying creative solutions that put the members first above all else. It was a wonderful example of what a Co-op should be and can be when the right people and the right attitudes are involved.


The day marked the capstone of a Co-op year (June-to-June as our PEC calendar goes) in which we have accomplished so much. Some of the highlights of note include: six consecutive rate reductions that will be followed up by a 7th reduction (2 mils) due to roll out in August; a successful switchover to a new enterprise software system that has already saved the Co-op millions of dollars in less than a year of its operation; an on-Bill solar financing program that is a unique and creative way to help interested members pursue rooftop solar without needing subsidization from their fellow members (the opposite of rebates); a complete overhaul of our charitable giving programs that puts more control in the hands of members (this will be the topic of my next post); and the release of a new rate study that will soon yield decreased Service Availability Charges for members who choose eBills and Bank Drafts. The rate study will also yield long awaited Time of Use rates that will allow participating members the opportunity to alter their energy habits, consume more off peak power, and further decrease their electric bills. Without a doubt, CEO Hewa and his highly capable Executive Team and staff have delivered on what the Board has asked them to deliver. We now have a more efficient, more responsive, more member-oriented, more nimble co-op that is showing us the real meaning of being “always on” for our members and the communities we serve.


At the Annual Meeting, Survey and Ballot Systems (SBS) – the firm that has run the PEC Director Elections the past few years – announced that District 5 Incumbent and Board President James Oakley had resoundingly won re-election, and Jim Powers, who ran unopposed to fill the seat left by retiring District 4 Director Chris Perry, had claimed a spot on the Board as well. Oakley won by more votes than any Director-Candidate had ever received in a contested election since the reform elections of 2008, a further indication that members are behind the improvements the Co-op is delivering these days.


Following the Annual Meeting, the Board held an organizational meeting to elect its 2016-2017 slate of officers. I was honored by my colleagues at that time with my election to the office of Board President. Oakley was elected Vice-President, and District 6 Director Paul Graf was re-elected Secretary/Treasurer for a second consecutive year. I must take a minute to thank Director Oakley for his outstanding leadership this past year as Board President. He managed to do the impossible – which was oversee our transition from at least two board meetings a month to just one, as is written in the PEC bylaws. By cutting down on the number of times we meet each month we are saving the Co-op money and saving our staff precious time that they can now use to further the Strategic Plan we have in place for them. Members must know that decreasing the number of our meetings was no small feat – prior Boards had been attempting to cut back on our trips to Johnson City for years, and under Director Oakley’s leadership, we were finally able to get it done. He also made sure we got through an aggressive amount of agenda items each meeting by keeping our conversations on point and attentions in the Board Room focused on the topics at hand. As a mother with small children back home, I was particularly appreciative of the improved efficiency – the difference between arriving home at 5:30, as opposed to 7:30, to two (now three!) little ones makes a big difference to me, and I know PEC staff and the rest of the Board Members feel the same way. I also thought Director Oakley’s method of asking for questions or commentary from our member audiences kept things fresh and kept the free flow of ideas between members, employees, and Board Members at the forefront of our Board Meetings. No doubt I’ll have big shoes to fill, and I’ll have my work cut out for me in ensuring we continue on an upward trend towards the big successes we on the Board envision for PEC in the future.


It’s been a pleasure to serve on the PEC Co-op Board for the past two years. I never dreamed in 2014 when I first joined this body that we would change so much for the better. While we can attribute much of our success to the strategic vision we’ve put in place at the Board level, far more of the credit belongs with our hard working Executive team, led by CEO Hewa, and the tremendous PEC employees, whom consistently demonstrate their commitment to making the Co-op experience a positive one for our members. The future at PEC is bright, and I look forward to seeing all that we have yet to accomplish in the Co-op year ahead.

Perspective for 2015

Happy New Year Co-op members!  It’s been a couple months since my last entry, which is mostly due to the hectic nature of the Thanksgiving and Christmas season and some year end travel. After a year of hard work and goals achieved, my family and I took the final weeks of 2014 to spend some much-needed quality time together and to focus on the most important things in life, which for us amounts to God and each other. It’s important to recharge and refocus every now and again, and after being able to do so, I feel ready to chase new goals in 2015.

In my mind, the best place to start goal setting is in reflection on recent experiences. Here are my takeaways from 2014 for better Board service this year:

  1. Welcome criticism – of all kinds.

One thing that is hard for everyone to stomach is criticism. It’s hard to hear that your performance does not measure up to people’s expectations. Especially for those amongst us that fit the “over-achiever” mold, getting anything less than an “A” stings.  I had the good fortune of growing up with a hyper-critical father.  At the time, I didn’t consider myself fortunate when I would ask him to read a paper I had spent days perfecting only to have it returned to me riddled with red ink and entire paragraphs crossed out. Eventually I picked up on what he wanted to teach me, which was how to be comfortable with criticism, and once I saw how his relentless corrections and suggestions affected my final product, I realized I should be grateful rather than annoyed. As my dad demonstrated to me when my papers went from B quality to A quality, it is really hard to deliver elite performances without the natural refinement that comes from responding productively to criticism. We should not be afraid to hear from the naysayers, as they provide us with the best opportunity to be better at what we do.

For PEC, that means that we should welcome the remarks of our biggest critics. Even if I, as a Board Member, do not agree with every critique we receive, I appreciate the perspective of someone who sees a particular issue differently than I do. PEC has a handful of members that let us know regularly things we could be doing better. Thank goodness for that! I hope they keep up their comments, however harsh they might be. We had a member recently send us a letter about transparency and openness at the Co-op, entitled Proposal for a True Open Records Policy at Pedernales Electric Cooperative, Inc., which we will be discussing at our Committee of the Whole meeting on Monday.   Detailed, thought-provoking critiques like that of this letter that force us to look at things we are doing or not doing with a new set of eyes.

  1. Be responsible for your own education.

My first six months as a Director for Pedernales Electric provided me with several learning moments and exposed me to the intricacies of the electric utility world, specifically electric co-ops. The energy landscape is constantly changing, and while it may be impossible to stay ahead of the curve, there is a lot that I can do as a Board Member to be more knowledgable and perform better in the Board Room. Most of the education I’ve gotten has come from me being proactive in seeking it out – whether it is asking PEC management and staff questions; talking to other professionals in different sectors of the utility world; reading endless articles people send me; checking energy news feeds daily; and listening to those from the PEC membership that happen to know a lot about our industry, I’ve spent countless hours listening and absorbing so that I can make informed decisions. This educational activity, while time consuming, is very important to do, and I’ll keep putting in the hours because the decisions we make on the PEC Board affect you, the member, in significant ways.  I want to be in the best shape possible to make those decisions.

As a side bar, I’d like to report on another educational opportunity I had recently. In December I traveled to Nashville for a week to complete my Bylaws-required NRECA Credentialed Cooperative Director classes. As it currently states in the PEC Bylaws, a new Board Member must complete all five of these courses before the end of his or her first year on the Board. Since Spring 2015 is going to be very busy for me and my family, I decided the safest bet for me was to knock out all five courses at once at the NRECA Winter School. I have to admit that I was skeptical upon embarking on my trip to Nashville that this week away from my family right before Christmas would be worth my time. I will say, however, that while much of the information was a repeat of things I’d already learned through my own initiative, a few of the classes turned out to be very educational.  (One particular instructor gave me some great insight into power supply – I hope I have the chance to interact with him again.)  I don’t think it’s necessary to take these courses frequently, but depending on the course and the instructor, NRECA educational opportunities can be beneficial. I’ve had several members question me directly about the costs surrounding Director education, and some have asked me specifically to tell them how much my trips would cost. On this trip to Nashville, I made a point of living as frugally as possible. I opted to use the per diem for meals and incidentals as opposed to reimbursing all meal receipts. I didn’t rent a car, and I only took a cab twice to get meals outside of the hotel, as it was incredibly expensive to eat at the Gaylord Opryland, which is where the conference occurred. Even with my efforts to keep costs down, I’ll be reimbursed over $2,000 for my trip, which doesn’t include my airfare or the cost of the classes themselves.

All things considered, I benefited from the education I received in Nashville. However, I believe the focus on education can be local and still provide us with the knowledge we need to do our jobs. There is a lot we can learn from experts here, and perhaps we need to look into ways we can bring educators from NRECA to us in order to avoid expensive travel costs.

  1. You can’t please everybody.

PEC currently has over 250,000 member-owners, and each of them has his or her own ideas about how the Co-op should operate. While it is vitally important to remain in tune with what the membership wants and the specific issues that are brought forward, I must also remember that you all elected me to do a job on your behalf. My job is to uphold the Co-op’s Bylaws and perform my fiduciary duties to ensure PEC is grounded in sound business principles and delivering, safe, reliable, and affordable electricity to you every day. I know there are people that disagree with my perspective and the decisions I make in the Board Room. That reality will continue.  As Directors we are called upon to make some hard choices, and as a result, people get upset regardless of the positions we take. It’s no secret that I lean hard towards fiscal conservatism, and because I believe low cost electricity benefits us all, especially the most vulnerable amongst us, you can expect me to continue to make decisions with that leading principle in mind.  Regardless of who that attitude might upset.

 Looking ahead to 2015…

There are a lot of important things coming up in 2015 of which PEC members should take note. We will shortly have the results of our Integrated Resource Plan, which will give us a better picture of our power supply options in the near future. We will complete a Cost of Service and Rate Design Study, which will include member-input opportunities. Be sure to check out the PEC Website for more information, and I’ll post information here and on my Facebook page as well. The debate over our potential Renewable Energy investments also looms on the horizon. I ask that you stay informed and ask questions if you have them.  Your input is as important now as it’s ever been.

As always, it is an honor to serve the PEC membership.

Refining PEC Processes: Part 2

A few days ago, I began a four-part series of entries concerning recent developments at Pedernales Electric Cooperative. In my first piece, I covered a recent change to our Director election policy that will be instituted in the 2015 elections. Click HERE to read more about it.

Now my focus will turn to another Director-related topic, which is the Co-op’s policy regarding Director education. As it stands now in the PEC bylaws, each Director is required to attend an initial series of “beginner” courses within his or her first year, to be followed up by further education as necessary to perform a Director’s fiduciary duties. The current policy reads as such:

Article III. Section 2.m “[A Director must] be willing to devote such time and effort to his or her duties as a Director as may be necessary to oversee the Cooperative’s business and affairs including…obtain[ing] the Credentialed Cooperative Director (CCD) designation from NRECA within the first year after election to the Board; [and] attend[ing] state and national association meetings and Director continuing education training as needed to maintain current knowledge and improve awareness of potential risks to the Cooperative.” (Click HERE to read a copy of our current bylaws.)

At our September committee meeting, a bylaw amendment was proposed to change the education requirements for Directors. This amendment would change the time period in which a Director had to complete the initial training from one to two years after being elected. It also would have REQUIRED Directors to “complete two courses, conferences, seminars, or training opportunities each year beginning with the first anniversary after their election to the Board of Directors.” (Click HERE to see the proposed amendment in it’s full form, p. 118)

Almost all of the Directors had some problem with this amendment. One Director didn’t like the idea of extending the time allotted to receive the initial training. She believes that training is crucial in order for a board member to be effective. I had a problem with the resolution from a different angle – and several of my other colleagues on the Board agreed. I’ll go over my objections in a minute, but the major takeaway here is that the end result of our discussions was that we indefinitely tabled the amendment. The bylaws will not be changed to make room for these new Director education requirements.

While this issue ends up being something of a moot point since it didn’t gain traction, I think it’s important to note why several board members and I objected to this resolution. The first question we must ask ourselves is when is it appropriate for the Board of Directors to alter the bylaws in the first place? I remember a gentleman spoke at our annual meeting about this very question. He noted that PEC’s bylaws – the member-owners’ protecting documents – could be changed at anytime and for any reason by the Board. That particular statement troubled me, especially when he further went on to give the example that somewhere along the lines, the bylaws had been altered to change the Co-op’s mission from delivering “lowest cost” power to “competitive[ly] price[d]” power.  Maybe that’s just semantics, but it could amount to much more. After all, “competitive” is quite loose. Competitive with whom?! Lowest cost, on the other hand, is pretty concrete. I would have preferred to keep the language the way it had originally been written.

One could argue – and it’s a fair argument – that Directors must be able to change the by-laws without approval from a majority of members because our Co-op is so large, and we get such low voter turnout.   We might never be able to change anything because we would never get enough participation. There are some who would say that is a GOOD thing – they don’t want the bylaws to be changed! Others would say the policy we have of allowing time for member-review of proposed bylaw changes before the Directors take a vote is plenty thorough to insure members have a chance to voice objections or concerns before the proposed revisions are adopted. I see value in both sides of the argument, but I do believe at the very least there should be some inclination from the membership that changes are desired before we even bring the issue of a bylaw change forward for discussion. Changes should not be made solely at the whims of the Board.

I personally had never heard anything from a member suggesting a desire for Directors to be required to get a minimum of two continuing education courses per year. If anything I had heard several people express concern regarding the costs associated with Director education, namely travel, lodging, and convention fees and expenses. The issue of cost brings me to my second objection to this resolution – what actually is the value of “continuing education” for Directors? I honestly do not know. I haven’t been around long enough, and I haven’t even attended the beginning NRECA Director courses required of first-year PEC board members. I’m set to do that in December, as that is the only time I can get all five courses done without other conflicts arising before my first year on the board expires. (Unfortunately, I will even have to miss the December board meeting in order to get this education – I doubt that this was the intent of the bylaws, and yet we see what can happen when the bylaws are freely changeable. Unforeseen circumstances are bound to arise.)

The bottom line is we must take into account the costs associated with sending board members on Co-op related trips to get education. What do we, the PEC members, get out of our Directors attending? Perhaps they learn a lot of valuable information. Perhaps not. I guess I’ll find out in December. Beyond the initial training, though, I think there is room for us to explore if there is a better way for us to educate our Directors than sending them off to expensive conferences – maybe we could team up with fellow Central Texas Co-ops and bring educators here so that we can cost share and all benefit together. You know, the whole co-ops-helping-co-ops principle. I would love for us as a board to investigate something like that.

I know I still have a lot to learn about PEC and the co-op world in general. I’m asking questions. I’m seeking out answers. I’ve become a student of the energy sector, and I’m enjoying the material tremendously. Since my election in June, and for months leading up to it, I have spent hundreds of hours educating myself on the electric industry and PEC specific matters. I see great value in that type of education, and I know it has made a difference in my performance on the board. As long as I have the privilege of serving you in my capacity as a Board Director for Pedernales Electric, whether or not I’m able to travel to seminars and conferences, I will be committed to educating myself on matters that affect my decision-making abilities.

“Refining PEC Processes:  Part 3 will be out early next week.”