A Message from EVP and General Manager Greg Andress: Returning $3.48 million to you
May 13, 2020
As an electric cooperative, Union Power Cooperative operates as a not-for-profit utility. One cornerstone of the cooperative business model is the allocation and retirement of Patronage Capital in the form of capital credits. This is the two-step process that returns margins to the member-owners of the cooperative. That process is explained in greater detail below.
In an effort to assist with the financial hardships some of our members are facing related to the COVID-19 pandemic, our board of directors authorized an early distribution of $3.48 million in capital credits. The distributions of these capital credits will begin in June, instead of the fall, as in most recent years.
This year’s capital credit retirement is comprised of 100% of the unretired balance of 2001 allocations and 25% of the unretired balance of 2002 allocations. This means, if you had service with us during the years of 2001 or 2002, you will receive a payment.
For those members who are eligible for a payment, you will see this in the form of a credit on your June bill. There are some members who have moved off our system since 2001 or 2002. Those former members will receive a check in the mail.
Capital credits are one of the tangible benefits of being a member of an electric co-op and a big part of what makes us different from other utilities. You can learn more about capital credits by visiting our website, union-power.com. If you have questions, please contact one of our customer service representatives at 704-289-3145.
It is a privilege to serve the membership of Union Power Cooperative. On behalf of the whole Union Power family, I wish you the best during this time.
Capital credits: A two-step process
Step One: Allocation
Each member’s share of the cooperative’s margin for a given year is determined. Margins are allocated—or assigned—to members who purchased electricity from the cooperative during the year in
which the margin was generated. The co-op keeps a permanent record of each member’s capital credit account, which is where the allocated amount remains until it is paid—or “retired.”
Step Two: Retirement
After reviewing the financial health of the cooperative, the Board of Directors may declare a retirement, at which time all or part of each member’s balance of previously allocated capital credits may