Coast Electric Power Association President and CEO Ron Barnes announced at the cooperative’s 2022 Annual Meeting that the cooperative will retire $6,229,069 in capital credits to its members, which is the largest retirement in company history. Checks are scheduled to be mailed to eligible current and former members in December. By the end of 2022, Coast Electric will have paid more than $87 million in capital credit retirements to current and former members.
What are capital credits?
Member-owned cooperatives are not-for-profit organizations operated for the benefit of their members. In general, if there are revenues from electric services in excess of operating costs and expenses, those funds are credited to a member’s capital account based on their patronage. Such funds, which are also called ‘capital credits,’ are the life blood that enables cooperatives to satisfy the future growth and power needs of its members. Capital credits represent a critical source of equity for Coast Electric. Since a cooperative’s members are also the people it serves, capital credits reflect each member’s ownership in, and contribution of capital to, the cooperative.
Where does the money come from?
Each member is allocated capital credits based on how much energy they obtain from the cooperative. The more energy a member purchases, the greater the amount of capital credit allocated to the member’s account. At the end of each year, Coast Electric subtracts operating costs and expenses from operating revenue collected during the year. This difference is called margins, which are allocated to the members on the basis of patronage.
How does capital credit retirement work?
Any member who has purchased electricity from Coast Electric during the time period being retired is eligible to receive a capital credit check. Checks will be mailed to the last address Coast Electric has on file. This is why it is important for former members to make sure we have your current address on file.
Members who have questions about their capital credit accounts, may visit https://coastepa.com/my-benefits/#capital-credits.