There are three types of utilities: investor-owned, municipal, and electric cooperatives. See the definitions for each below:
Investor-owned utilities (IOUs) are privately owned by individual investors, private funds, and private pension plans that purchase shares or stocks in the investor-owned utility for the purpose of receiving a financial return on investment. IOUs provide services that include electric generation, electric distribution, and natural gas distribution.
Municipal utilities (Munis) are nonprofit entities that are publicly owned and controlled by local government agencies. Municipal utilities may also include services for natural gas, water, sewage, and telecommunications. There are more than 2,000 municipal utilities in the U.S.
Electric cooperatives (Co-Ops) are private, not-for-profit businesses governed by their consumers (known as consumer-members). The majority of co-ops distribute electricity to consumers through low-voltage residential lines that cover more than 75 percent of the nation's land mass. Many of these distribution co-ops, as they're called, have joined to create co-ops that provide them with generation and transmission services. Distribution co-ops also buy power from investor-owned utilities, public power systems, federal hydropower power marketing administrations, and the Tennessee Valley Authority. There are more than 900 electric cooperatives in the U.S.
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