What are capital credits?
Sharing excess revenue with members is a core cooperative principle. Margins that are not reinvested back into the system are allocated to members based on the energy they purchased during the year. Federal tax law provides cooperatives with certain preferences and exemptions, such as federal tax-exempt status. This exemption requires we run our cooperative “at cost” not charging more than what it costs us to bring our members safe and reliable energy. Every cooperative board decides how and when to retire (pay) capital credits to its members.
The Cooperative pays the bills for things like power generation, maintenance and operations. The money left over after those bills are paid each year is called a margin. Margins provide equity for the Cooperative and are assigned to you – the members – through capital credits.
Capital credits are distributed in two ways:
- Current members’ capital credits are applied toward their bill.
- Former members, who no longer have a bill where credits can be applied, will receive a check in the mail.
Capital credits represent the assigned share of the Cooperative’s margins based on the amount of kilowatt hours each member used for that year.
Keep your address current with us, so we can forward payments to you when capital credits are retired in the future. Please call us at 740-344-2102 to update your address.
No; you should return the check to The Energy Cooperative and call us at 740-344-2102. We'll send you an estate packet to complete.
When income exceeds expenses in any given year, margins are allocated to each member’s capital credit account according to their usage; this is called capital credit allocation. Capital credits are periodically retired and returned to members when the Board determines that it will not jeopardize the financial condition of the cooperative to do so.