July 30th, 2019 by Allie Bennett, Marketing and Communications Manager
Cooperatives are democratic organizations; founded, organized, and ran by their membership. Macon Electric Cooperative was founded in 1938 with the intention of improving the quality of life for rural citizens of the area. That commitment still holds true today. While electric cooperatives are non-profit organizations, they have been known to purchase and operate for-profit subsidiary businesses, when deemed appropriate by their board of directors. Some types of businesses that cooperatives across the nation have owned and operated include internet, propane, and telephone subsidiaries. The funds from these organizations are kept separate from those of the cooperative and the subsidiary business operates independently of the cooperative organization.
The overall purpose of acquiring a subsidiary is much like that of the overall cooperative business model: to provide additional benefits to the cooperative’s membership. Macon Electric Cooperative owns a for-profit subsidiary HVAC company: Macon Electric Heating and Air. To understand how and why MEC came into ownership of the business, let’s take a step back into the history of how Macon Electric Heating and Air was formed.
History of MEHA
In 1987, Macon Electric Cooperative began selling ground source heat pump systems to members as a member service and energy efficiency initiative. The cooperative wanted members to understand the money-saving advantages that came along with this new technology. Through their geothermal sales, MEC contracted with Goddard Heating and Air, LLC to complete the installation of the geothermal units. With this partnership already in place, Macon Electric Cooperative decided to purchase Goddard Heating and Air in 2007, renaming it Macon Electric Heating and Air (MEHA). The company was purchased for a number of reasons, including providing additional quality HVAC services to the MEC membership, advancing energy efficient heating and air opportunities in the area, and providing additional quality jobs to our rural citizens.
MEHA Today
Macon Electric Heating and Air, LLC now operates as a subsidiary of Macon Electric Cooperative, with their headquarters office located in Marceline. The company employs eight individuals from the area: Paul Kuhman, Scott Henderson, Ronda Paalhar, Tim Richardson, Audie Niemeier, Joe Pagliai, Robert Morris, and Tim Gardner. MEHA offers a variety of services, including Geocomfort geothermal heat pump installation, Bryant conventional heating and cooling equipment (including gas, electric forced air, Mini Split systems, and Air to Air heat pumps), in-floor heating, and gas line installation.
The Connection
Since cooperatives exist solely for the benefit of their membership, decisions made for the subsidiary are always made with the MEC membership in mind. However, the companies operate independently of each other. Therefore, the accounting practices are handled separately. Money from the electric utility itself is never combined with or used to satisfy any of the subsidiary’s billing, and vice versa. Macon Electric Heating and Air is governed by the same board of directors that the Macon Electric Cooperative members democratically elect each August, but the executive team is elected separately from the co-op and the meetings are held separately, as well. In addition, the company does not only service Macon Electric Cooperative members, but also has many of their own customers that do not reside on MEC’s lines.
Macon Electric Heating and Air has seen increased success in the past few years, with geothermal heat pump sales being the cornerstone of the business. The company has installed hundreds of ground source units since inception and continues to take on new jobs that put geothermal heating and air systems to the test. One such project to note is a recent job located near Brookfield at the home of Mr. and Mrs. Harold and Clydene Loyd.
Loyd Pool Project
In August of 2017, Mr. and Mrs. Loyd approached Scott Henderson with a heating and air project that was very unique: to heat their indoor pool and pool house. The couple wanted to heat their 20 by 40-foot pool to 86 degrees year-round and keep their 28 by 68-foot pool house to a constant temperature of 86 degrees, as well.
Henderson initially had the idea to recommend using geothermal heating to the Loyd’s, because he knew it would be the most efficient method for them. Geothermal would have the potential to save them hundreds to potentially thousands of dollars on their annual heating bill. While choosing this system would be the most money-saving option for the Loyd’s, it was also going to incur the largest up-front cost. When Henderson ran the numbers based upon usage and output of the geothermal system versus a gas system, the savings was indicated that encouraged the Loyd’s to select the purchase that was almost $15,000 more initially. However, this choice would prove to pay itself off in less than two years. The calculated savings was almost $700 a month on their electric bill.
“We were excited about the expected savings that the geothermal units would provide,” stated Mr. Loyd. “This type of system is definitely the way to go for any heating and cooling application.”
The Loyd’s agreed with Scott and decided to proceed with the project using geothermal heating. It was started in November of 2017. The project included a five-ton Geocomfort Water-to-Water geothermal unit to heat the floor in the pool house and six-ton Geocomfort Water-to-Water geothermal unit to heat the water in the pool itself. Unique considerations for the project included avoiding metal ductwork due to the humidity level that was created in the room and strategically placing the heat pipes in the concrete for maximum effectiveness. MEHA overcame the challenge by purchasing a canvas-based ductwork system for the humidifying unit and installing plastic molding material for the concrete heat lines. The project was completed in March of 2018.
Over a year later, the Loyd’s are very happy with their purchase and the geothermal units are keeping the pool and pool house to their desired temperature. “I’m thrilled with our geothermal system and its ability to keep our pool so warm, even in the wintertime,” Mr. Loyd explained. “Macon Electric Heating and Air and Scott Henderson were wonderful to work with and we were able to count on them throughout the whole process and even after the fact.”
All-in-all, this project was one of a kind and is the only geothermal install of its kind in the area. Both MEHA and MEC recommend that when considering the purchase of a new HVAC unit for any purpose, look at geothermal first. Have MEHA or your HVAC contractor run the numbers and explain the payback of the geothermal unit as opposed to any other system. While the up-front cost may be a little higher in some scenarios, the payback is well worth the investment.
For more information on geothermal heating and cooling systems, or Macon Electric Heating and Air, please visit www.maconeelectricgeothermal.com or call (660) 376-3636.