Bargaining Outcomes in Rural Electric Cooperative All-Power-Requirements Contract Negotiations in a Deregulated Retail Market

Generation and transmission cooperatives and distribution cooperatives have developed a relationship based on an all-power-requirements contract that will likely be untenable within a deregulated environment. Application of a key bargaining model indicates substantial advantages in favor of REC customers that will necessitate a search for other contractual forms that give customers flexibility to take advantage of deregulated market rate savings while still allowing G&Ts to retain low-interest federal financing options.