Capital Credits

Application for Retirement of Business Capital Credits
Application for Retirement of Decedent Capital Credits

Because Orcas Power & Light (OPALCO) is a cooperative, owned by its members, it does not technically earn profits. Instead, any revenues over and above the cost of doing business are considered “margins.” These margins represent an interest-free loan of operating capital by the membership to the cooperative. This capital allows OPALCO to finance operations, and to a certain extent construction, with the intent that this capital will be repaid to you in later years.

How are capital credits calculated?
The amount of capital credits you earn in a given year is based upon the amount of capital you contribute to the cooperative through payment of your monthly bills. The more electric service you buy, the greater your capital credits account—although the percentage will remain the same. The sum of your monthly bills for a year is multiplied by a percentage to determine your capital credits.

What’s the difference between allocated and retired capital credits?
Allocated capital credits appear as an entry on the permanent financial records of the cooperative and reflect your equity or ownership in OPALCO. When capital credits are retired, a check is issued to you and your equity in the cooperative is reduced.

What do I have to do to start accumulating capital credits?
Capital credits are calculated by OPALCO for everyone who purchased electricity during a year in which the utility earned margins. No special action is required to start a capital credits account. Your membership activates your capital credits account.

How are capital credits disbursed?
Whenever OPALCO’s finances permit, we return capital credits to our members on a 25-year cycle (for example, in 2008 we retired the capital credits allocated in 1983). The decision is made by our board of directors after a thorough examination of the co-op’s financial position. Each year, OPALCO members receive a statement in their bill that indicates the amount of capital credits accrued under each account.

What happens to my capital credits when I leave OPALCO’s service area?
Your capital credits remain on the books in your name and member number until they are retired. So, you should ensure that OPALCO always has your current mailing address.

What happens to the capital credits of a member who dies?
The capital credits of a deceased member may be paid, on a discounted basis, without waiting for a general retirement. However, these estate payments are not automatic. A representative of the estate must request the credits by submitting a Certification of Entitlement form and a copy of the death certificate. These will be considered by the OPALCO Board of Directors. If retirement is approved by the Board, a check will be issued to the estate and the account closed.
Application for Retirement of Decedent Capital Credits