Each spring, members receive notification of capital credits acquired the previous year. Members will not receive a refund or bill credit for the allocation at this time. In the fall, the board of directors determines if a percentage of capital credits will be returned to members, and if so, what amount. The board makes the decision based on the financial condition of the cooperative.
As a member-owned cooperative, Central Electric does not earn profits like most other businesses. After Central Electric deducts costs and upkeep for yearly operations, the net profit is reinvested into the company to provide cash flow, collateral to show stability and to obtain loans. Any net profit over those costs is allocated back to the members in the form of capital credits. Every member of Central Electric has shares in capital credits. The more electricity you buy and the longer you use the service, the more monetary equity (allocations) you accumulate. Allocations are the total sum of annual equity accrued by the member during their prior year of service.
When the board decides to issue refunds, active members will receive a credit on their December bill and inactive members will receive a check. Capital credits are one of the many benefits of being a member of Central Electric Cooperative. When you have Central Electric as your electric provider, you are part owner of the cooperative through the equity you have invested.