Goes to the Country
Morris Llewellyn Cooke
Administrator, Rural Electrification Authority
typical cooperative project grew out of a letter from a county agent
in Henderson County, Kentucky, who wrote that a few local farmers
were interested in securing electricity, and asked information and
advice about a construction loan.
man sent by the REA development section made a rapid survey of Henderson
County conditions. To a meeting which followed there came, not the
few farmers expected, but nearly a hundred, with their leaders,
and the presiclent of the State Farm Bureau Federation.
desire for electricity, and the prohibitive cost of obtaining
service from the local power company, were set forth by the county
When the REA
plan was outlined, the farmers learned that tenants as well as
landlords could secure electric power and that, as security for
the government loan, a lien is placed on the government-financed
power line and its revenues, not on the farmer's property. They
learned that money allocated for building a line covers its entire
cost, including a service line to each farmhouse served; that
a cooperative group must be incorporated, and that a project must
he deemed self-liquidating by REA to secure a loan.
grew rapidly. Prospective customers signed for service. A marked
map of the territory was submitted to the REA engineers. After
much correspondence between the Henderson County Rural Electrification
Association and REA to clarify all details of the scheme, an allocation
of $190,000 was made. The amount covers the building of 153 miles
of highline (at a cost of $1150 a mile) and three small sub-stations.
This line cost, decidedly higher than the REA average, is accounted
for by the large number of customers to the mile7.8requiring
separate transfomers and motors, and by difficult physical conditions.
The Henderson Municipal Plant is to supply electricity for these
rural lines. The retail cost to each customer probably will be
approximately $4.25 for the first 100 kwh. Additional power consumed
will be cheaper.
of the first year of REA has been especially valuable in demonstrating
the desirability of a long term, carefully planned program. Under
the line extension policies generally in practice until recently,
the more prosperous farms in a given area ultimately received
electric service, while the less prosperous farms by that very
fact became more isolated, less able to bear the expense of the
extension. The result was a haphazard rural system of finger-like
lines, with great pockets of unserved areas between and beyond
them. Obviously a system planned in advance to cover a given area
thoroughly would have been far more satisfactory to the consumers
and in the long run to the companies.
The gratifying results of such planned electrification
in many European countries are common knowledge. Less familiar,
perhaps, is the story of electrification in New Zealand. With
a large number of dairy and stock farms, and an average population
density of fifteen people to the square milethree less than
the state of NebraskaNew Zealand offers a good basis for
comparison with rural America. The government there instituted
a widespread electrification plan in 1918, dividing the entire
country into fifty-five electric power districts. Forty such districts
have already begun operation, thirty-nine of them in predominantly
rural areas, supplying cheap and abundant electricity to farms.
Steady expansion built on sound beginnings has already brought
electric service to two thirds of New Zealand's rural population,
and the operations as a whole show a good reserve margin.
on the farm
Under its ten-year program, REA hopes to bring
electricity to another million American farms. Its emphasis will
be on loans for distribution lines, in order to continue cooperating
as far as possible with existing producers of electric energy.
of the REA activities has widespread implications. Insistence
on progressive construction standards, coincident with efforts
of some utilities, has led the industry to admit that sturdy and
efficient rural lines can be built under widely varying conditions
for approximately $950 a mile. The accepted figure until recently
ranged from $1600 to $2400 and upward. Electrifying an entire
area and the application of competitive bidding and large scale
buying methods to REA projects have furthered construction economy.
But the rural
line, once built, cannot vitally affect farm life unless the farmer
is able to make use of the energy it brings. In the past many
farmers who felt that they might scratch together enough cash
for an extension hesitated to do so because they could not also
meet outright the expenses of wiring their homes and barns and
purchasing equipment. The Tennessee Valley Authority and some
of the private companies of the Southeast have shown that the
way to successful operation is through low rates inducing high
consumption. But high consumption demands appliances„appliances
whose cost is not a drain on but a supplement to farm income and
farm comfort. A new feature of the REA plan is provision for financing
house wiring and the purchase and installation of electrical appliances,
and modern plumbing equipment. Loans so used will be limited to
a period not exceeding two thirds of the assured life of the equipment,
with interest at approximately the prevailing rate for government