Central Electric is a cooperative, owned by the people we serve. They are more than customers. Here at Central, we call them "members" or "member-owners."
One way ownership is reflected is through capital credits. These are members' share of what's left over after we have paid the costs of delivering power, and set aside appropriate funds for emergency situations and regular growth projects. When we are financially able to do so, these capital credits are distributed to members. That means the member-owners financially share in the successful operation of the cooperative. Capital credits are one of the tangible benefits of being served by a co-op.
This year will mark 16 years in a row that capital credits have been retired. During this time frame, over $18 million will have been returned to members. In 2024, the co-op gave back $1.1 million and members who received service from the cooperative during 2006 received a capital credit retirement check. Retirement amounts greater than $25 were issued a check, while all others were applied as a bill credit.
Why does it take so long to receive a capital credit return? While it may seem odd, or a long time, it’s actually a benefit to the membership. Capital credits are a portion of the funds that help operate the co-op. The co-op holds on to these funds for a period of time in order to help finance improvements to the system. This also helps the co-op avoid borrowing as much money to fund system maintenance and upkeep. They serve as operating capital that funds the service provided to your home or business. At the end of the cycle, the capital credits are returned directly to the members. This return of capital credits to you, our members, is a SIGNIFICANT identifier of the cooperative business model.
Capital Credits FAQ
Capital credits are a direct benefit of your cooperative membership. Instead of returning profits to investors and distant stockholders, Central Electric returns capital credits to the local members we serve. As a cooperative, Central Electric operates “at cost,” meaning it does not aim to make a profit for outside investors. Instead, any revenue remaining after covering annual expenses is allocated to members in the form of capital credits and returned to them over time. Capital credits are allocated and distributed annually, based on the amount of electricity you purchase.
Capital credits are based on your total payments to the cooperative for kilowatt-hours of energy purchased, including the fixed charges. If you receive a smaller credit than your neighbor, it’s because you used and paid less for electricity during the period in which the capital credit allocation was earned.
Allocated capital credits are your share of any money the co-op has left over after paying expenses. This amount stays on Central Electric’s books and accrues over time. When capital credits are retired, the co-op pays some of that money back to you, either as a check or a credit on your account.
When the co-op’s financial condition permits, capital credits are returned in the form of checks or bill credits. When capital credits are issued, retirement amounts greater than $25 will be issued a check, while all others will be applied as a bill credit.
The capital credit distribution cycle is determined by the board of directors. Even if you don't receive a return this year, you will earn a capital credit allocation for all years that you are a Central Electric member. Once you're eligible for a distribution on those allocations, you'll receive it even if you're no longer receiving electric service from Central Electric, so it is important to make sure we always have your current mailing address.
While it may seem odd, or a long time, it’s actually a benefit to the membership. Capital credits are a portion of the funds that help operate the co-op. Central Electric holds on to these funds for a period of time in order to help finance improvements to the system. This also helps the co-op avoid borrowing as much money to fund system maintenance and upkeep. They serve as operating capital that funds the service provided to your home or business. At the end of the cycle, the capital credits are returned directly to the members. This return of capital credits to you, our members, is a significant identifier of the cooperative business model.
Capital credits are allocated to members annually and reinvested back into the cooperative to purchase new equipment and build new infrastructure. The board carefully sets the amount to return to members each year. If all capital credits were given back immediately, the board would have to increase rates to replace those funds.
No, capital credits do not earn interest. They represent your share of the co-op’s margins and are set aside for you, then paid back over time as the cooperative’s finances allow. Because the co-op’s main purpose is to provide reliable, affordable electricity at cost — not to make a profit — it does not pay interest or dividends on capital credits. In effect, paying interest would require the co-op to increase rates to offset the added expense.
In most cases, residential members do not need to pay taxes on capital credits. However, if you claim any part of your electric bill as a business expense, you may have to report your capital credits as income when they are paid out. Please check with your tax advisor for advice on your specific situation.
Even if you move or disconnect service, you retain your capital credit allocations from the time you were served by the co-op. These capital credits will be paid out over time as a part of normal general retirement distributions. When a retirement is approved for a period of time during which you were a member, capital credits will be issued to you at that time, not when you disconnect service. If you do move, it is essential that you maintain an updated address with the co-op, so we can ensure your capital credit benefit is paid to you at the appropriate time.
If we do not have updated contact information for you, you may have unclaimed capital credits. Check our Unclaimed Capital Credits list below and if your name is listed, click on it to open the claim form.
If a member’s capital credits go unclaimed, the money is escheated to the state of the member’s last known residence, based on that state’s dormancy laws. The dormancy period, the time before money is considered unclaimed, varies by state or territory but typically ranges from 2-5 years. Central Electric escheats to all 50 states, Washington D.C., and US territories. If the member’s last known address was international, or associated with an APO or FPO, those monies are escheated to the State of North Carolina. After the funds are escheated, they can no longer be claimed from Central Electric. Instead, the member must contact that state’s unclaimed property office directly to recover the money.
The capital credits of a deceased member may be paid to a beneficiary without waiting for the normal retirement cycle. These estate payments are not automatic — the proper paperwork must be completed. A representative of the estate must submit a CEMC application, provide a copy of the death certificate, and include an original legal letter from the Clerk of Court showing they have the authority to receive the funds. In addition, the electric service must be transferred out of the deceased member’s name before the payment can be made. Completed applications are then submitted to the board and the co-op’s attorney for approval. The full process can take several weeks.
Unclaimed Capital Credits
Due to different factors, we may not have up-to-date contact information for members, past and present. You may have unclaimed capital credits waiting for you. Enter your name or other info to search our databases. The listing below reflects all unclaimed capital credits on file of more than $5. If your name is listed, click it to open the claim form.
