No. 22-1884 ___________________________

Dakota Energy Cooperative, Inc.

Plaintiff - Appellant

v.

East River Electric Power Cooperative, Inc.

Defendant - Appellee

Basin Electric Power Cooperative

Intervenor Defendant - Appellee

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Next Generation Cooperative Alliance; Geoffrey F. Heffernan; Jeremy D. Weinstein

Amici on Behalf of Appellant(s) ____________

Appeal from United States District Court for the District of South Dakota - Southern ____________

Submitted: November 15, 2022 Filed: July 28, 2023 ____________ Before BENTON, KELLY, and ERICKSON, Circuit Judges. ____________ KELLY, Circuit Judge.

Dakota Energy Power Cooperative, Inc., a member of East River Electric Power Cooperative, Inc., sought to withdraw from East River and to terminate the parties’ long-term power contract so that it could purchase electricity from another source. When East River resisted, Dakota Energy sued for anticipatory breach of contract and sought a declaratory judgment providing that it had a contractual right to withdraw from East River by way of a buyout. The district court 1 granted summary judgment in favor of East River, and Dakota Energy appeals.

I.

Dakota Energy is a South Dakota-based electric distribution cooperative that provides electricity to its rural consumer-members. East River is a South Dakota generation and transmission cooperative that purchases electricity wholesale and then resells it to its members, including Dakota Energy.

When Dakota Energy became a member of East River in 1995, the two parties entered into a long-term power supply agreement known as a wholesale power contract (WPC). The WPC provides that

East River shall sell and deliver to [Dakota Energy] and [Dakota Energy] shall purchase and receive from East River, all electric power and energy which [Dakota Energy] shall require to serve all of [its] electric loads, to the extent that East River shall have such power and energy and facilities available. The WPC describes the “terms, conditions, and rates for the furnishing of electric power” under the agreement and explains that the rates paid by Dakota Energy will be used to cover, among other things, “the cost of the operation and maintenance”

1 The Honorable Lawrence L. Piersol, United States District Judge for the District of South Dakota. -2- of East River’s “transmission system”; the “cost of related services”; the cost of maintaining “reasonable margins and reserves”; and the “principal and interest payments” on East River’s “indebtedness.” As relevant here, the WPC further provides that it “shall remain in effect” until December 31, 2075, and “thereafter until terminated by either Party giving to the other not less than six months’ written notice of its intention to terminate.”2 No provision in the WPC expressly allows for termination prior to this 2075 end date.

By joining East River, Dakota Energy also agreed to comply with the former’s Bylaws. Those Bylaws provide that “[e]ach member shall purchase from [East River] all electric power and energy required by the member to serve all its electric loads,” subject to limited exceptions not relevant here. The Bylaws also allow a member to “withdraw from membership upon compliance with such equitable terms and conditions as the Board o