It’s that time of year again! More than 3,500 people who were co-op members in 1985 will get a check from OPALCO later this month as their capital credits are distributed. This is one of the distinctions that make an electric co-op unique: it is truly member owned and operated and we each have a “stake” in the utility. Once a year, as OPALCO’s finances permit, the Co-op returns capital credits to its members on a 25-year cycle. The decision is made annually by the board of directors after a thorough examination of the Co-op’s financial position.
What are capital credits? Because Orcas Power & Light (OPALCO) is a not-for-profit cooperative, owned by its members, it does not retain profits. Instead, any revenues over and above the cost of doing business are considered “margins.” These margins are allocated to members as capital credits at the end of the year. OPALCO members receive a statement in their bill each summer that indicates the amount of capital credits allocated for the previous year. This member capital allows OPALCO to finance operations and some construction projects, with the intent that this capital will be repaid to co-op members in later years.
The amount of capital credits members earn in a given year is based upon the amount of capital they contribute to the cooperative through payment of their monthly bills in a formula that compares each member’s ratio of usage to the rest of the co-op. The more electric service a member buys, the greater their capital credits allocation. The capital credit check amounts being distributed this year range from $5 to thousands of dollars (large users like schools and grocery stores). The majority of the checks (1,240) are in the range of $100 – $250.
Because OPALCO distributes capital credits on a 25-year cycle, it’s important to keep OPALCO updated with your current address—even if you’ve left the area and are no longer a member. When you leave the area, you can apply to the Board of Directors to receive a discounted distribution of your allocated capital credits. The capital credits of a deceased member may be paid, also on a discounted basis, upon approval of the Board. See www.opalco.com/members/capital-credits or the bylaws (Article VIII, Section 2) for full details. If you have specific questions about your capital credits, please call member services at 376-3500.
OPALCO is a member-owned cooperative electrical utility serving more than 11,000 members on 20 islands in San Juan County. OPALCO provides electricity that is 95% greenhouse-gas free and is predominately generated by hydro-electric plants. OPALCO was founded in 1937 to bring electricity to rural islanders.
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Capital credits have always been a sore point with me. When we moved to Lopez in 1992 the board said they needed to hang on to the credits because of the need to underground the island after the early 80″s storm which left San Juan County without power for eight days. The emergency is over yet we pay these credits out in an extremely unfair manner. If you are old or young for that matter and have to leave the island, I feel you should be cashed out on the spot. Holding peoples money without interest is inappropriate. Or put another way, just because you can do something doesn’t mean you should. When people terminate their membership they should receive their money in full. Perhaps this might mean reducing the size of the payroll or the pace of the under grounding. When Doug Bechtel resigned as general manager there were 39 full time employees. We now have pushing 60. You add up the numbers. The rate of growth is not any faster now then then.This is a small member owned coop, not Puget Power who gets the state to grant rate increases based on their net return without regard to how bloated the company might be. it is interesting how two different management styles get the job done. One on a chevrolet budget and one on a BMW.