Principles

The Seven Principles of Cooperatives

Cooperative leaders often reference the Seven Cooperative Principles. Many of these cooperative principles are engaged as electric cooperatives increasingly look to solar energy. We provide some examples below, following the industry standard descriptions of each principle.

1st Principle: Voluntary and Open Membership

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

2nd Principle: Democratic Member Control

Cooperatives are democratic organizations controlled by their members, who actively participate in setting their policies and making decisions. Men and women serving as elected representatives are accountable to the membership. In primary cooperatives, members have equal voting rights (one member, one vote) and cooperatives at other levels are organized in a democratic manner.

This principle is at work in solar when cooperatives respond to member demand for more solar and when Boards of Directors make plans for additional solar and renewable energy generation. It can also apply if cooperatives provide opportunities for members to become solar producers themselves.

3rd Principle: Member Economic Participation

Members contribute equitably to and democratically control the capital of their cooperative.  Often, at least part of that capital is the common property of the cooperative. They usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: developing the cooperative (possibly by setting up partially indivisible reserves), benefiting members in proportion to their transactions with the cooperative and supporting other activities approved by the membership.

When members invest in solar power production on their own premises or in cooperative-owned community solar, they are participating economically in their cooperative and contributing to their community.

4th Principle: Autonomy and Independence

Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.

When cooperatives make plans to develop or support solar development, they are enhancing autonomy, independence and security by relying on the sun – a resource that no one else can control, restrict or embargo.

5th Principle: Education, Training, and Information

Cooperatives provide education and training for their members, elected representatives, managers and employees so they can contribute effectively to the development of their cooperatives. They inform the general public – particularly young people and opinion leaders – about the nature and benefits of cooperation.

Cooperatives support education in many ways with new solar projects such as the Spoon River solar farm learning center. Cooperatives also support education by providing real-time power production data online or on-site classrooms or webcams for members and others to learn more about solar power.

6th Principle: Cooperation Among Cooperatives

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

Cooperatives work together on solar plans time and again. This occurs when distribution (retail) cooperatives make plans for new capacity with their generation and transmission (wholesale) cooperative power supplier. It also occurs when cooperatives form trade groups to share strategies for solar development, such as the National Renewables Cooperative Organization.

7th Principle: Concern for Community

While focusing on member needs, cooperatives work for the sustainable development of their communities through policies accepted by their members. Six principles have guided cooperatives for the past 30 years. The number of principles increased to seven as the result of a vote taken by the General Assembly of the International Cooperative Alliance in Manchester, England, on September 23, 1995. The goal of the new principle is to better reflect the needs of cooperative members in today’s society.

Cooperatives often “pitch-in” together with their communities to help plan and develop new solar resources. There are many ways these projects can benefit the community, such as when cooperatives invest in solar at schools or other public facilities to serve their community and help to educate the next generation.