Dakota Electric Association is retiring $1.2 million in capital credits this year. The payment was authorized by the board of directors at their November meeting and checks are being mailed in December.
When Dakota Electric collects more in revenue in one year than it pays out toward expenses, it tracks (allocates) that money for each member based on their annual electric bill. The money that is allocated to members’ accounts is called capital credits. The amount of capital credits allocated to members becomes their equity in Dakota Electric and is used as capital for projects needed to maintain reliability. Retaining capital helps offset the amount of money Dakota Electric needs to borrow for capital projects.
Members receive capital credit payments when Dakota Electric’s board of directors retires capital credits. The board of directors reviews our financial position each year and determines the amount of capital credits from previous allocations Dakota Electric can pay to members in cash.
The $1.2 million retired this year is for members who purchased electricity from the cooperative in 1982. The amount each member will receive is based on the amount of electricity billed in 1982.