Purchase of electricity by electric co-ops
This question has several parts.
1. What industry sector would we use to measure economic impacts of rural electric cooperatives? They are generally 501c Not-for-Profit organizations. However, they are generally not units of local government.
2. Distribution cooperatives often do not generate their own power, but instead purchase electricity from electric power generating companies. When we ran state-wide hypothetical models based on $100 million of increased revenues in Sector 31 (Electric generation, transmission, ...) and Sector 431 (State and local government electric utilities), the analyses identified very little Indirect activity in Sector 31. Why? How can we correct for this?
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IMPLAN SupportHi Robin. If the board running the non-profit is voter elected, then it is a government enterprise utility (431), otherwise private sector 31. Both industries 31 and 431 produce commodity 31 which is the electric generation AND distribution commodity. If only, distribution then you should edit the industry to remove fossil fuels and pipeline transportation inputs. As mentioned above, the industry (431 and 31) both generate and distribute power, therefore, they do not need to purchase power to distribute as they are already generating it as part of their production function. Please contact us if we can be of further help.0 -
But what of those rural electric coops that do not generate electricity, but instead purchase it from another entity?0
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IMPLAN SupportHi Robin. We deeply apologize for the late reply to your follow up Post. In response to your question, we would suggest that you import an Industry Spending Pattern for Sector 31 and edit the industry to remove fossil fuels and pipeline transportation inputs and then normalize. The Activity Level for the spending patterns should only reflect the amount of the payment spent on intermediate purchases (i.e., non-payroll portion of the budget or output). Then a separate Labor Income Change Activity is required to get the payroll effects - this requires knowing beforehand what percent of the payment went to payroll (Employment Compensation (EC) and Proprietor Income (PI) --both as fully loaded) and what percent went to other purchases. Since you know Output/sales, but not the Intermediate Expenditures (IE) it can be easily calculated on the basis of Output = Intermediate Expenditures + Value Added. So the value of you Activity Level for you spending pattern will be Intermediate Expenditures and the remainder (Output-Intermediate Expenditures) will be the Value Added. If you need to estimate each component of Value Added you can use the Study Area Data for this. In the Explore menu, navigate to the Explore> Social Accounts> Balance Sheet (Tab), and select View By: Industry Balance Sheet and the Value Added tab. When you select the Sector 31 from the drop down menu that represent your spending pattern for your Analysis-by-Parts. This will provide a complete breakdown of how the Value Added components sum from Output for that Sector. You can take the EC and PI shares for Sector 31 and multiply each by the Value added portion to get estimates of these value to do the Labor Income change portion of your analysis. We hope this helps.0
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