Capital credits are a unique economic benefit of being a member of an electric cooperative. Members economically participate in the Cooperative through their electric billings and share in PEC's margin through capital credits, which accumulate if revenues exceed expenditures. Capital credits are not held in an account; instead, they are either distributed to members in the form of capital credit refunds, or reinvested into utility infrastructure.

Every year, when all expenses have been accounted for, any remaining revenue is allocated to each eligible member's capital credit account. These allocations are records of each member's portion of the end-of-year margin. Capital credit allocations and distributions are two distinct processes.

2008 Capital Credit Allocation

Capital credits for 2008 have been allocated to members' accounts, and members received notice in mid-October 2009 of their personal allocation amount. Allocations for each member are calculated by determining the dollar amount of the member's total electric billings (the total amount spent on electricity, excluding taxes, late fees, and returned check fees) for 2008 and multiplying that amount by the capital credit allocation factor, which for 2008 is .02251975.

2009 Capital Credit Distribution

In November, PEC will return up to $4 million in capital credits to eligible members. Members are eligible for the distribution credit if they have a positive capital credit balance from 2008 or previous years, have an active account in the target month of September, and receive a bill in November. Checks will be issued and mailed beginning in mid-November for eligible members with distributions greater than $1. Members with distributions of $1 or less will receive credits on their November electric bills.

Additional eligibility information on capital credit allocations and distributions is available in the Capital Credit Information document in the blue box on the left side of this page.