Poudre Valley Rural Electric Association (PVREA) is paying out its largest capital credits retirement in history to its members this week – a total of $6 million.
As a cooperative, PVREA operates as a consumer-owned organization and any margins are credited to cooperative members each year based on how much electricity they purchased. These funds are called capital credits and are used to help meet the expenses of the co-op, such as paying for new equipment to serve members and repaying debt. Capital credits help keep rates at an affordable level by reducing the amount of funds that must be borrowed to grow and maintain the electric system.
Every year the Board of Directors determines if financial conditions allow for the retirement of capital credits. This year, the Board of Directors approved the retirement of capital credits for patronage capital allocated in 2000, 2001, 2002 and 2014. Members who received service from Poudre Valley REA in those years, and have accumulated retired credits of $10 or more, is receiving a check in the mail this week.
"Paying capital credits to our members is one of the many factors that make electric cooperatives unique and differentiate us from investor-owned and municipal utilities,” said PVREA Chief Executive Officer Jeff Wadsworth. “Since we are a not-for-profit organization with a 501 (c)(12) tax designation, we return capital credits as a tangible representation of our members’ investment in PVREA.”
Over 49,000 consumers received a capital credit retirement this week from the Cooperative. Poudre Valley REA has paid out over $48.5 million of capital credits since its founding in 1939 and $18 million of capital credits annually in the past five years alone.
More information on capital credits is available here or by calling 800-432-1012.