Wright-Hennepin to return $1 million in Capital Credit Refunds to members during holiday season
Posted on December 1, 2010
Rockford, MN (December 1, 2010) — Due to another strong operational, financial and competitive year for Wright-Hennepin Cooperative Electric Association (WH), almost all of it’s 40,000 members will receive a Capital Credit refund on their energy bill this holiday season.
WH’s Board of Director’s recently declared a Capital Credit return of one million dollars to members who purchased electricity from the cooperative during 1986, 2008 or 2009. This is up from $800,000 last year.
Membership in the Rockford-based electric cooperative entitles all members to share in the organization’s year-end success. Each year that WH earns a margin (the amount left after expenses have been deducted from revenue), this margin is allocated to cooperative members based on their energy use during the years being retired (noted above). Before returning these allocated margins back to members, however, WH uses this capital for a time to offset the cost of debt for equipment and facilities used for the construction and maintenance of the electric distribution system. This working capital represents the members’ ownership equity in WH, a key component of the cooperative business model used across the U.S. This helps keep WH’s electric rates as low as possible because it lowers financing needs. These funds are eventually retired according to a schedule determined by the Board of Directors. WH’s board has elected to retire, or refund, these capital credits on member electric bills during the holiday season.
“The Board of Directors is again pleased to return margins to local members despite so many challenges in the economy,” said Chris Lantto, Board Chair. “We thank the membership for their patronage and ongoing support.”
WH retires portions of annual margins faster than many other electric co-ops in the nation because of a member approved bylaw amendment in 1998. This amendment has resulted in more members being eligible for a Capital Credit refund each year and earlier than previous policy. Per cooperative bylaws, WH’s member-elected Board determines the amount of margins retired each year based on the cooperative’s financial condition and other considerations.
Since refunds were first made in 1957, more than $30 million has been returned to members in Wright and Hennepin counties via Capital Credit refunds. This is the 30th year in a row that the Board has made Capital Credit refunds to WH’s members.
WH’s Board of Directors include Chair Chris Lantto, District 5, French Lake; Vice Chair Thomas Mach, District 6, Maple Grove; Secretary-Treasurer Dale Jans, District 4, Buffalo; Timothy Young, District 1, Annandale; Duane “Butch” Lindenfelser, District 2, Monticello; Burton Horsch, District 3, Howard Lake; Sarah Evenson, District 7, Plymouth; Donald Lucas, District 8, Maple Grove; and Erick Heinz, District 9, Corcoran.
WH is a member-owned non-profit electric utility that provides electric power to Wright County and the western part of Hennepin County. The cooperative has been a corporate citizen in this area since 1937 and currently serves more than 46,000 electric accounts. The utility started its security division in 1989 that provides local home security solutions as well as monitors alarm systems for more than 50,000 customers in 32 states and three Canadian provinces.