Capital Credits

Capital credits are just one of the differences at Guthrie County REC

The retirement of capital credits is the tangible demonstration of your ownership in Guthrie County REC.  As a member-owned cooperative, Guthrie County REC operates as a not-for-profit utility.  This is accomplished through the retirement of capital credits.

In fact, your board has established an aggressive goal for retiring capital credits of 15 years or less.  Currently, we are on a 13-year rotation with $3.77 million in deferred capital credits for 1996-2010.

What are capital credits?

Any "profits" made by the cooperative are referred to as margins.  At the end of each year, the margins are allocated to each member's captial credit account in proportion to the amount of electricity purchased after all statutory and reserve requirements are met.  From the time the margins are generated until they are returned, this money is put to work within the cooperative, minimizing debt financing and strengthening our financial position.

How is the distribution of capital credits determined?

Before distributing the capital credits, your board of directors at Guthrie County REC must first consider the financial condition of the cooperative and the needs for capital funds for the coming years.  The capital credit amount is determined by the board and is set at a level that maintain the financial integrity of the cooperative.  Specifically, the board evaluates the equity goals of the cooperative, the capital credit rotation plan, the cost of borrowing money, plant growth and storm reserves.

Do you want to learn more about your capital credits?

If you have any questions or would like more information, please give us a call at 641.747.2206 or 888.747.2206.