San Miguel Electric Cooperative, Inc. Named Finalist for a USDA New ERA Funding Program that Prioritizes Low-Emission Energy Systems for Rural Electric Cooperatives
CHRISTINE, Texas [September 6, 2024] – San Miguel Electric Cooperative, Inc. (SMECI) has been named a finalist for a United States Department of Agriculture (USDA) Rural Utilities Service (RUS) program that would provide grants and low-interest loans to expand energy that prioritizes greenhouse gas reductions. The Empowering Rural America (New ERA) program is offered through the Inflation Reduction Act.
San Miguel is a not-for-profit generation and transmission rural electric cooperative located in Atascosa County, Texas that operates a mine-mouth lignite-fired power plant. If awarded the New ERA program funding, SMECI will convert its lignite operations to a 400 megawatt (MW) solar generation and 200 MW battery storage facility to provide clean, reliable, and affordable renewable energy to rural Texans.
“At SMECI, we take pride in our attention to detail in safety, environmental compliance, community service, and mined land reclamation,” said Craig Courter, General Manager/CEO. “With funding from the New ERA program, we will virtually eliminate our greenhouse gas emissions while continuing to provide affordable and reliable power to rural Texans.”
SMECI, which began commercial operation in 1982, currently produces 391 MW of electricity to a service area that spans 47 South Texas counties. It does so through a Wholesale Power Contract with South Texas Electric Cooperative (STEC), which, in turn, supplies power to its distribution cooperative members who provide retail service to more than 340,000 rural Texas customers. While the STEC Wholesale Power Contract extends through 2037 and can be continued further, depending on lignite coal availability, the supply of lignite-fired electricity will be discontinued earlier if San Miguel is awarded the New ERA funding.
If SMECI can convert from lignite to solar, it will enter into a new Wholesale Power Contract with STEC to supply the output of the proposed solar and battery storage facility, which is expected to be operational by 2027.
SMECI could also use the New ERA funding to refinance debt from its stranded lignite infrastructure, which is a significant obstacle to its ability to transition to solar generation. The conversion will not affect SMECI’s ongoing mine reclamation program, secured by bonds that will not be released until regulators have determined that the mine reclamation is complete.
Reclamation is a vital part of a mining operation’s culture and – for SMECI – a passion. The cooperative works closely with its landowners to restore mined land to their preferred specifications. This can include pastureland, which uses vegetation, such as grasses, to provide feed benefits to ranch animals and build soil stability.
“San Miguel has long been – and will always be – a vital part of the South Texas communities that we serve,” said Courter. “With this innovative funding program, we will be able to provide rural Texans with renewable energy at an affordable rate, especially as the demand for electricity in Texas grows rapidly.”
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About San Miguel Electric Cooperative, Inc.
San Miguel Electric Cooperative, Inc. is a member-owned mining and power generation cooperative that serves the people of ’Texas’ rural communities, working and living in partnership with its members. Through integrity, hard work, and a commitment to safety, San Miguel maintains a dependable power supply at the lowest possible and competitive cost. Visit San Miguel Electric Cooperative for more information.