Since 1980, more than $20.4 million in capital has been returned to members. About 12,500 North Central Electric current and former members will receive their patronage capital credits refunds on their December bills. A refund totaling $715,947 was approved by the board.
“Refunding capital credits sets cooperatives like North Central Electric apart from other utilities,” Board President Duane Frankart said. “The board believes by refunding margins, we’re sending a positive message to our members that the co-op is financially stable and that their board is making sure we operate efficiently and effectively. Being a member of the cooperative is the reason you receive refunds while other people who are customers of investor-owned utilities, like AEP (American Electric Power) or FirstEnergy, do not.”
The total refund is up about 19 percent from 2017. Director of Finance and Accounting Kristine Dawson explained there are two components to the refund — North Central Electric’s portion and Buckeye Power’s portion. “The Buckeye Power 2018 refund was 42 percent more than it was in 2017,” Dawson said. “The cooperative’s portion of the refund also increased slightly.” Buckeye Power is the wholesale power supplier for NCE and is also a cooperative.
The cooperative retains annual margins to provide working capital for new construction, equipment, and system improvements throughout the cooperative’s service area. If NCE’s revenue exceeds expenses for the year, the excess is retained as margins and is allocated back to the members on the basis of their patronage.
The amount of each member’s patronage is determined by how much electricity is purchased during the year, as well as the rate at which the member is billed. The longer a member remains with North Central, the more the total amount of the refund will increase if his or her use remains consistent.
Each year, the cooperative’s financial condition is examined by the board of trustees to determine the refund amount.
Review of Capital Credits Refunds
Pre-2010 $ 14,127,258
2010 $ 746,423
2011 $ 707,530
2012 $ 578,667
2013 $ 725,119
2014 $ 689,373
2015 $ 693,150
2016 $ 891,446
2017 $ 599,174
2018 $715,947
Total $ 20,474,087