Residents received a gift in their November electric bill from La Plata Electric Association – the cooperative issued capital credits to its members.
The credits came as a deduction in a consumer’s bill for amounts less than $100 or a check if the credit amount was greater than $100.
This November, the cooperative divvied up $3.5 million total in capital credits that ranged from a few dollars to tens of thousands of dollars to big electric consumers like Walmart or Mercy Regional Medical Center.
Capital credits are the amount of money the rural, nonprofit electric utility receives in excess of all its expenses.
LPEA issued more than 30,000 credits to bills, averaging just less than $20.
The cooperative issued about 7,000 checks for capital credits in excess of $100. The average check was for $360.
Usually, capital credits are determined on a 21-year cycle, so credits largely went to people who were purchasing their electricity from LPEA in 1999.
LPEA Vice President of Finance Karl Ramsey said LPEA’s board of directors this year decided to accelerate some capital credits to LPEA’s 2019 members to help stabilize the economy in a year battered by the COVID-19 pandemic.
Of the $3.5 million in total capital credits issued, about $680,000 were credits to 2019 LPEA members, he said.
“Capital credits occur every year when we finalize our results, but usually it’s on that two-decade-long cycle. This year, there was another element,” Ramsey said.
Retiring credits from members in 1999 means a good proportion of people receiving bill deductions or checks went to people no longer living in the area. By accelerating credits to 2019, more money was received by people still living in the area, Ramsey said.
Last week, Tri-State Generation and Transmission Association also issued patronage capital to its members, which includes LPEA.
Patronage capital is similar to capital credits, a return to members of revenue taken in above expenses.
Tri-State provides about 95% of the electricity LPEA distributes.
Total patronage capital to Tri-State’s 45 members was $30 million.
Ramsey said LPEA’s share of the patronage capital was about $3 million.
Patronage capital is one of the revenue streams LPEA will use in figuring out future capital credits, Ramsey said.
parmijo@durangoherald.com
