Formation: CMEEC was established in 1976 as a publicly directed joint action supply agency. Our mission and operating principles are founded on state statutes, CMEEC bylaws and a long-standing commitment to serve community utilities
Legislative actions by Connecticut’s General Assembly, dating back to the early 1900s, defined the franchise areas of each municipal utility and limited electric service to the municipality itself, an adjacent municipality and/or portions therein. In 1975, the municipals obtained passage of legislation to form their own power supply company:
As a result, the Connecticut Municipal Electric Energy Cooperative (CMEEC) was created as the electric power supplier for the state’s municipal utilities. CMEEC became fully operational in 1978 as a non-profit, joint action power supply agency. Today CMEEC manages power supply contracts, financing, acquisition, construction and operation of generating resources. CMEEC supplies power to its members and wholesale customers through various sources, including fossil-fueled generators, nuclear plants, hydroelectric stations in Connecticut and massive power dams in Canada and New York.
All-requirements: CMEEC’s all-requirements model requires member utilities to commit to purchase essentially all electric power requirements from CMEEC. This commitment results in a joint action agency with cooperative strengths vital to CMEEC’s dealings with other utilities, the investment community and other energy industry stakeholders.
Tax-exempt: A basic statutory power given to CMEEC is legal authority to issue long-term tax-exempt electric power supply revenue bonds. CMEEC has the ability under law to borrow money at relatively low interest rates to pay for obtaining electric generating and transmission facilities. Repayment of interest received by bond-holders – the lender of money to CMEEC – is tax-exempt because the money borrowed is used for non-profit essential municipal utility purposes. CMEEC bonds are secured by power sales contracts between the agency and its Member or Participant utilities.
Customer-driven: The municipal utilities do not conduct their electric operations for shareholder profit. In fact, there are no shareholders of either CMEEC or the municipal utilities. The customers and citizens of the municipality are the only “shareholders” for municipal utilities.
Cost-based: Under the contracts, money paid to CMEEC for community electricity goes to pay the real costs of obtaining the power, such as direct power production costs, basic staffing costs, power plant financing costs, and costs of entering into more beneficial power supply contracts with regional suppliers. Importantly, money collected by CMEEC under rates for electricity supplied to municipals includes no so-called profit or shareholder dividends. Municipals are charged a rate based on the actual cost of obtaining power with an additional percentage capped by state statute.
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