Rural Minnesota electric cooperatives support defense industry growth and infrastructure

Rural Minnesota electric cooperatives are uniquely positioned to support growing U.S. defense industry infrastructure needs. As federal defense spending increases, Minnesota is gaining new opportunities to expand its role in national defense supply chains, especially in rural regions with reliable power, available land, and scalable infrastructure.

For Great River Energy and its member cooperatives, this growth creates a direct path to strengthen local economies while supporting national security goals.

This increase in defense-driven demand gives Great River Energy and its cooperatives a prime opportunity: expand rural impact by directly supporting national defense priorities.

Minnesota defense spending growth creates new opportunities

Minnesota defense spending is rising steadily, creating demand for suppliers, infrastructure, and industrial-ready sites.

In fiscal year 2023, Minnesota received approximately $2.4 billion in U.S. Department of Defense spending, up from $2.0 billion in 2022 — a 20% increase. This funding includes defense contracts, personnel, and construction.

As federal agencies expand engagement with Minnesota-based companies, rural communities are becoming increasingly relevant. Defense-related production, logistics, and technology operations are locating beyond major metros, where:

• Power reliability is stronger.
• Land is more available and affordable.
• Infrastructure can scale more efficiently.

Defense contracts support jobs in rural Minnesota

Defense spending impacts communities through more than prime contracts. Federal dollars fund subcontractors, professional services firms, construction companies, and manufacturers. Abridged fiscal year 2024 defense spending data show Minnesota capturing a share of national contract and personnel funding, supporting thousands of jobs and generating hundreds of millions of dollars in value added.

These sectors fit closely with rural Minnesota’s existing workforce strengths, including:

• Precision manufacturing
• Metal fabrication
• Electronics assembly
• Testing and logistics

Electric cooperatives play a key role by powering the industrial zones where this growth occurs.

Long-term defense investment strengthens infrastructure demand in Minnesota

Minnesota benefits from sustained federal investment through programs like the Readiness and Environmental Protection Integration Program (REPI).

Since 2004, REPI has directed more than $101 million into Minnesota, supporting:

• Military readiness
• Land use planning
• Infrastructure coordination
• Environmental protection

These investments support military installations and surrounding communities. The federal track record signals a long-term commitment and offers cooperatives a clear opportunity to act. For example, cooperatives can actively identify, pre-permit, and prepare adjacent sites for future defense-related development. This preparation ensures that communities can respond quickly and capture benefits when new federal projects arise.

This ongoing defense presence means rural cooperatives can immediately meet suppliers' infrastructure and energy needs, solidifying rural Minnesota as a reliable backbone for defense supply chains.

Why rural Minnesota is ideal for defense supply chains

Defense supply chains depend on stability and efficiency. Rural Minnesota, anchored by electric cooperatives, provides the resilient, cost-effective infrastructure the defense industry requires.

Electric cooperatives provide:

• Reliable voltage and redundant power systems
• Predictable energy rates
• Responsive, local service
• Scalable infrastructure planning

At the same time, rural regions supply:

• Large, secure sites for campuses and testing
• Fewer land-use conflicts
• Controlled access for sensitive operations

Great River Energy’s scale supports large defense projects

Great River Energy provides electricity across about 60 percent of Minnesota through its member-owner cooperatives. The system serves approximately 695,000 families, farms, and businesses. As one of the largest generation and transmission cooperatives in the country, Great River Energy operates at a scale that supports large industrial loads.

​This scale enables:

• Support for large industrial and defense loads
• Coordinated transmission and generation planning
• Consistent service across multi-site projects

Many counties within this footprint are already positioned for:

• Defense manufacturing
• Component assembly
• Data processing
• Logistics hubs

Grid investment enables power-intensive defense uses

Defense projects often demand more than baseline electric service. Advanced manufacturing, secure data operations, and testing environments require high load capacity and reliability planning.

Great River Energy and its member-owner cooperatives consistently invest in high-voltage transmission lines and system upgrades. These investments ensure large, power-intensive defense operations access to reliable, resilient electric service and shorten the time to energize new facilities.

For site selection teams, an accelerated connection timeline can directly affect project feasibility and a company's speed to market. Cooperatives’ deep local presence lets them customize solutions, expedite infrastructure improvements, and support developing security needs.

Grid reinforcement positions rural Minnesota to compete for projects that could otherwise go to urban or out-of-state sites. Electric infrastructure becomes a development asset rather than a constraint.

Defense manufacturing aligns with the existing rural industry.

Many rural Minnesota businesses already operate in sectors that translate directly into defense supply chains, including:

• Metalworking
• Electronics
• Composites
• Industrial services

With targeted support, these firms can:

• Obtain defense certifications
• Connect with prime contractors.
• Expand production capacity

Electric cooperatives and economic developers can identify and activate these hidden suppliers.

Electric cooperatives can partner with local economic development groups to identify firms that already meet defense standards or can qualify with a modest investment. Drawing on their close community ties and industry knowledge, cooperatives can help these firms understand requirements and navigate the certification process to become defense suppliers.

Construction and infrastructure projects create near-term demand.

Defense spending drives construction and facility upgrades. These projects demand contractors, materials suppliers, and utility coordination. Rural cooperatives often serve areas near training sites or support facilities undergoing upgrades.

Early coordination between utilities, contractors, and project owners reduces delays and cost overruns. Electric cooperatives’ responsive, locally-focused involvement secures better scheduling, load planning, and infrastructure design for defense projects.

These construction phases also introduce local firms to defense procurement processes, opening the door for follow-on work.

Workforce strength supports defense expansion

Defense employers seek skilled labor and stable operations. Rural Minnesota offers a workforce experienced in manufacturing, energy, and technical trades. Community colleges and training centers develop skills aligned with industrial needs.

Electric cooperatives often participate in workforce discussions through economic development efforts, offering deep local knowledge, strong community partnerships, and a commitment to reliable service.

Rural Minnesota offers a stable, skilled workforce with experience in:

• Manufacturing
• Energy systems
• Technical trades

Community colleges and training programs align closely according to industry needs, while lower turnover rates help reduce long-term operating costs for employers.

How electric cooperatives enable defense site selection

Electric cooperatives are critical partners in the defense site selection and development process. They provide:

• Load capacity data
• Infrastructure planning
• Local coordination
• Fast response timelines

They also support:

• Shovel-ready site development
• Industrial park marketing
• Regional economic development strategies​

To realize these substantial opportunities, electric cooperatives, community leaders, and defense partners must collaborate now to strategically align assets with future project needs and strengthen rural Minnesota’s position in national defense.

Policy and funding trends favor rural defense suppliers.

National defense budgets remain high, even as priorities shift. Supply chain resilience has become a stated federal goal. That focus increases demand for domestic suppliers located outside congested coastal regions.

However, the competition for these projects is intense, with neighboring states making targeted infrastructure investments and aggressive recruitment efforts. Minnesota risks missing out on considerable economic advantages if it does not continue to invest in site readiness and coordinated outreach.

Minnesota’s recent growth in defense spending reflects this shift. Rural regions that can support reliable operations stand to gain as agencies and primes diversify supplier locations.

Conversely, the cost of inaction is real: if Minnesota’s rural cooperatives and communities do not act to prepare sites and market local strengths, high-value defense projects may be awarded to other regions that have taken more forward-looking actions. Potential losses include jobs, tax revenue, and long-term supplier relationships that, once established, can be hard to recapture.

Electric cooperatives play a quiet but essential role in that strategy by enabling power reliability and system resilience.

Measurable economic development outcomes

Defense-related development generates measurable outcomes:

• High-wage job creation
• Increased tax basePrivate infrastructure investment
• Long-term industrial growth

For electric cooperatives, these projects also provide:

• Stable energy demand
• Improved system planning
• Cost efficiencies for members

Positioning rural Minnesota for future defense growth

Rural Minnesota is well-positioned to capture future defense investment.

With strong infrastructure, available land, and coordinated utility support, regions served by Great River Energy meet key defense site selection criteria.

Continued collaboration between:

• Electric cooperatives
• Economic development organizations
• Defense industry partners

This coordination will ensure these regions remain competitive in a fast-changing national security environment.

Frequently Asked Questions

How large is defense spending in Minnesota today?

Minnesota received about $2.4 billion in total Department of Defense spending in fiscal year 2023, up from about $2.0 billion in fiscal year 2022.

Why do defense suppliers consider rural locations?

Suppliers seek reliable power, lower land costs, room for expansion, and stable workforces. Rural regions often meet these needs while maintaining access to transportation and labor.

What role do electric cooperatives play in defense projects?

Electric cooperatives provide reliable power, system planning, and local coordination. Their service quality affects site readiness and long-term operating costs.

How can communities prepare for defense-related investment?

Communities can prepare by working with utilities, identifying suitable sites, supporting workforce training, and understanding defense procurement requirements.