How do Capital Credits Work?

You need to know 2 things about Capital Credits to better understand how they work:


  • When the cooperative has more revenue than expenses in a given year (referred to as a margin), the margin is distributed proportionately (allocated) to all members in the form of capital credits
  • A record of the yearly allocation is permanently maintained in the member’s name
  • These allocations are considered each member’s equity in the cooperative
  • The amount of capital credits a member earns is based on the amount of electricity purchased in a given year


This refers to capital credits that will be paid to you in the future.

  • The Board of Directors will determine what yearly allocations will be retired (paid back) to the members
  • This retirement cycle, from allocation to retirement, will typically be 25 years
  • The 25 year cycle reflects the average service life of electrical distribution plant and also the repayment term on debt that is incurred by Clark County REMC