Capital Credits FAQ

Operating Costs: The cost to maintain, repair, and construct the electric system (poles, wires, substations, etc).

Margin: At the end of the year, SCI REMC subtracts expenses from the amount of money collected, and the balance is called the margin. (This is similar to “profits” at IOUs.)

Allocate/Allocation: An approved method used to assign the margins to an individual’s capital credit account based on their patronage for that year.

Patronage: At the cooperative, your patronage is the amount of money you paid on your electric bill each year, and is used to determine your proportionate share of capital credits.

Retire/Retirement: The process of paying back the capital credits to members. The amount paid back is determined by what years of capital credits are being retired and the capital credits allocated to the member for that year. Capital credits are paid back by check or bill credit.

We work to give capital credits to both long-term members and newer members. Capital Credits from Operating Margins have been paid back for the years 1939 to 1982 and 1994 to 2016. A portion of the capital credits from Operating Margins for 1983 to 1988 and 2017 have also been paid back. Since 2002, we have paid more than $5 million in Capital Credits to members.

Yes! You will be entitled to Capital Credits earned while you were a member even after moving off our lines. It is important that you always provide us with your current mailing address.

Nothing. By purchasing electricity from SCI REMC, you are automatically considered a member, and an owner, of the Cooperative. At the end of the year, margins are allocated to each member that purchased electricity that year proportionately based on their electric purchases. SCI REMC keeps a record of capital credits for each member for each year to be paid back at a later date. The Board of Directors regularly evaluates the financial position of the Cooperative and determines whether to pay back capital credits. Then the board determines what years, if any, will receive a capital credit refund that year.

The Board of Directors regularly evaluates the financial position of the Cooperative and determines whether to pay back capital credits. Then the Board determines which Capital Credits from what year(s) will be paid back.  This is called a capital credit retirement.  There may or may not be a capital credit retirement every year.

South Central Indiana REMC is a not-for-profit, member-owned cooperative. Capital credits set Cooperatives apart from Investor-Owned Utilities (IOUs). While IOUs try to earn profits to give back to their investors, Cooperatives work hard to provide their electric service as close to cost as possible. Any margins (revenues minus expenses) at the end of the year are allocated to our Member-Owners in the form of Capital Credits.