Seven Facts About Capital Credits
What are capital credits?
As a cooperative, we are operated on a not-for-profit basis. After all expenses are paid for the year, any money (left over is allocated back to you as capital credits, in proportion to the amount of energy you used. Those allocations become member equity, or your share of ownership in the cooperative. The money is used to operate and build your cooperative, and then returned to you through a refund at a later date. We have, over the past 18 years, retired nearly $5 million in capital credits.
What is the capital credit information I see on my May bill statement?
First, there is your 2007 capital credit allocation, provided each year as an official record of your capital credits, along with the total of capital credits allocated to you but not yet paid. Your allocation is not payable at this time, and does not represent cash, but rather your equity in Tri-County Electric Cooperative.
Second, if you were a member in 1983, 1984, or 2007, there is a credit on your bill. The board of directors authorized retirement of $350,000 in capital credits from the power supply portion of your energy bill, with half of the retirement from 1983 and 1984, and half from 2007.
My neighbor’s allocation is $25. Why is mine only $10?
You probably don’t compare grocery bills with your neighbor, because you make different choices at the store. You also might not compare your cars’ gas mileage, because you drive different models and have different driving styles.
In the same way, you really can’t make a fair comparison of electric bills. Each house has different energy efficiencies based on choices of insulation, windows, doors, building materials, wiring, appliances, and personal use of the appliances. Your capital credit allocation is based on your home’s actual energy use, and how much you paid Tri-County for that during the year.
I use e-Bill at the HomeWorks website. Where do I find my allocation and retirement amounts?
At this time, our e-Bill program does not show capital credit allocations. A member’s e-Bill will show any capital credit retirement which is credited to the energy bill. Members can also look at their Capital Credit history on e-Bill to see past capital credit retirements. If you would like specific information about your capital credits, you may call us at 1-800-562-8232 or email us at tricoenergy@homeworks.org.
When will I receive the rest of my capital credits?
They remain allocated to you as part of the member equity in HomeWorks Tri-County Electric, and will be returned to you in future years as finances permit. As equity, it helps us build and maintain the cooperative to provide you with reliable power.
What if I move? What happens to the money then?
We ask that you keep your address records up to date with us, even if you no longer receive electric service with the cooperative, so that future checks can be sent to you.
What good are capital credits? Why don’t you just lower your rates instead of charging too much?
Like any business, we need to charge enough to not only cover the actual costs of providing you with electric service, but also to prepare for contingencies such as storms and other catastrophes. We have to be prepared for sudden increases in the costs of our supplies, and we also have to take in enough to maintain and build the electric system so that it continues to operate reliably.
Capital credits are tangible evidence of your ownership in the cooperative, and they are a way of ensuring each generation of members pays its own way by providing its own equity.