Capital Credits
A primary difference between a for-profit investor-owned company and a cooperative, such as Egyptian Electric, is what happens to revenue above and beyond annual operating expenses.An investor owned (for profit) company disperses excess revenue (dividends) to its investors, those that own stock in the company. Investors invest in a company primarily for one reason; they expect a return on their investment. It does not make any difference how much they contributed to the revenue of the company (such as paying a monthly utility bill), unless they own stock, they will not receive any distribution of the profits.
A cooperative, on the other hand, distributes excess revenue to those that purchase goods or services in proportion to their contribution of the revenue. The more you contributed to the revenue through your purchases, the more that’s returned to you if there is excess revenue. We call these refunds of excess revenue Capital Credits.
A cooperative’s board of directors determines when a cooperative should make a refund or distribution of Capital Credits. This decision is based on the financial status and cash position of the cooperative. Directors must balance the desire to return capital to the membership against the need and cost of borrowing funds to make distributions and improvements to the electric system.
Our Board of Directors has established a policy that we do make discounted early distributions of Capital Credits to estates upon request. If you or someone in your family is a beneficiary of the estate of someone eligible to receive a refund, please contact us at 1-800-606-1505 or email us at info@eeca.coop with the name and date of death of the deceased party. We will be happy to send you the applicable paperwork and other information.
