Capital Credits
Returning Value to Our Members
One of the biggest differences between a cooperative and an investor-owned utility is that you are more than a customer — you are a member and part-owner of 4 Rivers Electric Cooperative, Inc.
When you pay your electric bill, part of that money supports the day-to-day costs of providing power. Each year, any funds left over after expenses are called margins. Instead of those margins being paid to shareholders, the funds are allocated back to members in the form of capital credits. Those capital credit contributions are kept and used to support long-term projects to benefit the co-op.
Annually, the co-op's board of trustees reviews the co-op's financial health and decides how much of the capital credits can be returned to members. This process, called capital credits retirement, is one of the benefits of being part of a cooperative, reflecting the principle of Member Economic Participation, one of the seven core cooperative principles.
How Capital Credits Work
Allocated: Each year, we calculate each member’s share of the co-op’s margins. That amount is recorded as your capital credits.
Retained: Capital credits are retained by the co-op for a period of time to help fund system improvements—such as building and maintaining power lines, transformers and substations. This reduces the need to borrow money and helps keep rates stable.
Retired: When the board of trustees determines the co-op’s financial position is strong, a portion of capital credits may be returned (retired) to members. Retirements typically happen in two ways:
- General retirements – usually issued on a yearly basis to current and former members.
- Estate retirements – paid out to the heirs of a member who has passed away, upon request and approval. If you are handling the estate of a deceased member, please contact us for more information on how to claim these funds.
