Pedernales Electric Cooperative today announced it will distribute nearly $8.9 million in capital credits to members this year, raising the lifetime distribution to $99 million since 2007.
The 2016 distribution was approved in October after the PEC Board of Directors reviewed the cooperative’s fiscal health and determined the amount will not result in any adverse impact.
Because PEC is a cooperative owned by its members, it does not earn profits. When revenues exceed expenses, the cooperative earns margins. Each year, when financial conditions allow, those margins are allocated to members in the form of capital credits.
This year’s distribution, outlined below in more detail, will be executed in accordance with the cooperative’s capital credits policy:
- Members who accumulated capital credits in 2015 will receive 64 percent of their allocation, discounted to approximately 17.5 percent, which represents the net present value of their credits. This distribution will total approximately $4.3 million.
- Members may opt out of their discounted 2015 capital credits if they prefer to receive non-discounted credits in a future distribution, which PEC predicts to be on a 30-year cycle.
- Members who accumulated capital credits in 1985 and 1986 will receive 100 percent and 55 percent, respectively, of the non-discounted credits allocated from those years. This will total approximately $4.3 million.
- The estates of deceased members received an estimated total distribution of $300,000.
Current members are scheduled to receive distributions as credits on their December bills. Members with multiple accounts will receive credits for all of them on a single account’s bill.
Former members with capital credit distributions totaling more than $10 will receive a check. A check may be issued for any distribution under $10 by request or when accumulated unpaid distributions exceed $10. Former members are encouraged to contact PEC to ensure their current address is on file.
Members will receive more information about capital credits with their December bill. Additional information is also available at pec.coop/capital-credits or through our capital credits line at 800-230-2207.