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1961-1975

Basin Electric Power Cooperative

Exactly how a super generation and transmission (G&T) cooperative should be organized was a topic of discussion in the late 1950s and early '60s. The idea of the regional power supplier interested many distribution cooperatives and led to the formation of what we know today as Basin Electric Power Cooperative.

One idea was for this super G&T to become the wholesale supplier and everyone who needed power would become customers. Under this model, cooperatives purchasing power would have no voice in management of the plant, establishing rates, conditions of service, etc. They would simply be a customer.

Instead, Basin Electric was formed on the premise that it would provide power for intermediate G&Ts. This power would be low-cost because of economies of scale. Basin Electric would be managed by a board of directors elected from the membership and run in a matter consistent with cooperative principles.

On April 4, 1961, 67 distribution cooperatives from eight states met to officially form Basin Electric Power Cooperative. In Minneapolis they seated eight directors from the membership. (Henry Swenson was seated in 1962).

Basin Electric was incorporated on May 5, 1961 in Bismarck, ND.

James L. Grahl Basin Electric's first employee and General Manager 1961-1985 One of the first moves the Basin Electric organization made was to hire its first general manager, James L. "Jim" Grahl, from the American Public Power Association (APPA) . During the Grahl years, Basin Electric grew rapidly: it constructed three baseload power plants - a total of five generating units with 3,219 megawatts of capacity - to supply power for its members. Mr. Grahl stressed the importance of the independent distribution cooperatives working together as a family – accomplishing more collectively than alone. He also developed political partnerships like MAPP and Midwest Electric Consumers Association.

Lignite Electric and Basin Electric

Basin Electric was not the only G&T in the region hoping to build a power plant; Lignite Electric (now Minnkota Electric, Grand Forks, ND) was also seeking REA money to build a lignite power plant in North Dakota. Area cooperatives were divided as to which power supplier to partner with: Basin Electric or Minnkota.

It was through many meetings between the officers and members of Basin Electric and Lignite (Minnkota) Electric that it became clear that Basin Electric’s proposed plant would best meet the needs of the Missouri River basin preference customers in 1965, when supplemental power from the Bureau of Reclamation would terminate. Officers from Lignite Electric agreed to step aside by requesting REA to give prior consideration to Basin Electric's loan request.

The fact that Basin Electric was given preference for the REA loan was due to its commitment to serve large parts of the Missouri River basin. Lignite Electric planned to serve a smaller region: parts of North Dakota and Minnesota.

1963 Annual Meeting

Basin Electric applied for an REA loan to finance its first power plant. The loan was granted, but REA had one stipulation: Basin Electric had to offer a special sign-up period to allow other co-ops who wanted regional power to become members. It was during this time that Central Power, Rushmore Electric and others became Basin members. In the case of Central Power and Verendrye Electric, they were involved at the very beginning when Basin Electric was formed, but they had their own power plant at the time, so that is why there was a little delay until they officially became Basin Electric members.

In search of a plant site

Leland Olds Station construction

After securing the financing for a power plant, the focus became finding an adequate site to build a power plant. Adequate water supply was needed, using existing federal power lines instead of building a lot of new transmission, and securing low-cost fuel were important factors in determining the plant’s site. North Dakota received immediate consideration because of its abundant lignite coal and the mine-mouth-to meter capability. "Minemouth-to-meter" means that all elements for producing baseload electricity are in one place: the water, the coal and WAPA’s transmission system. Only 12 miles of transmission had to be built to connect LOS to the Federal power grid. Another factor was that state laws that were favorable to cooperatives.

Leland Olds Station (LOS)

Basin Electric's first power plant was named after Leland Olds, who promoted the concept of regional electric power supply. LOS Unit 1 came on-line in 1966 (210 MW) and the next one came on-line in 1975 (440 MW). LOS is located near Stanton, ND.

Pooling transmission

One key to Basin Electric providing low-cost power for its members was its agreement with the Western Area Power Administration (WAPA) [then the Bureau of Reclamation]. U.S. Army Corp of Engineers built the dams & the Bureau marketed the power. (Note: WAPA is now called "Western").

Basin Electric signed a pooling agreement with WAPA to deliver power across the federal transmission system. Basin Electric paid for the transmission based on the amount of megawatts generated. WAPA provided backup power if LOS Unit 1 went off line. Basin Electric provided backup power for WAPA if its generation went off line. Basin Electric also agreed to charge WAPA a reasonable agreed upon price for selling power.

When LOS Unit 2 came online (1975), an REA loan stipulation forced Basin Electric to join MAPP (Mid-Continent Area Power Pool) because it needed backup generation if LOS Unit 2 went off line. WAPA did not have adequate backup generation to support Basin Electric, so Basin Electric joined the regional power pool.

William J. Neal Station (WJN)

In 1973, Basin Electric purchased the William J. Neal Station from Central Power in Minot, ND. When Central Power joined Basin Electric (1964), a condition of membership was to sell its generating assets to Basin Electric. Basin Electric was the generator, intermediate G&Ts managed the delivery of that generation, and distribution co-ops delivered the power to end-use consumers.

In April 1952 when the station was built, it was the largest, state-of-the-art lignite powered station in the United States. Coal for the mine was supplied by TRUAX, then the largest coal operation in the United States.

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