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Capital Credits

What Are Capital Credits?

Central Florida Electric Cooperative (CFEC) is a member-owned, not-for-profit cooperative. Our goal each year is to collect just enough from our members to cover the actual cost of providing safe, reliable electricity and to maintain the long-term financial health of your cooperative. In a perfect world, we would “break even” every year — collecting nothing more and nothing less.

But in reality, that’s nearly impossible. Many factors outside of our control can cause costs to rise or fall unexpectedly, such as:

  • The price of fuel used to generate electricity
  • Labor and equipment expenses
  • Storm damage and emergency restoration work
  • Growth in our service area

Because of these fluctuations, sometimes we collect a little more than it costs to serve members. These extra funds are called margins. Rather than keeping them as profit like an investor-owned utility would, CFEC sets those funds aside and allocates them back to you — our members — in the form of capital credits.

Think of capital credits as your share of CFEC’s margins, based on how much electricity you used that year. They’re one of the most tangible benefits of being part of a cooperative: when we do better, you do better.

How Do Capital Credits Work?

  1. Each year – After our books close, CFEC’s Board of Trustees reviews the financials.
  2. If there’s a margin – That year’s members are allocated capital credits based on their electricity use.
  3. In the future – When the Board determines CFEC’s finances are strong enough, those credits are “retired” (paid back).

📌 Example: In 2024, CFEC returned $860,000 in capital credits to its member-owners who received electric service in 1996 and a portion of 1997.

Why Didn’t I Get a Check This Year?

Capital credits are not automatically returned each year; they are retired only when the Board determines it is financially responsible for the co-op. Some years, challenges like hurricanes, high growth, or rising material costs make it wiser to hold off. This decision helps protect long-term reliability and service quality for all members.

Even if credits aren’t retired in a given year, they’re still on record under your name and will be retired in the future when the cooperative’s financial position makes it prudent to do so.

Our Track Record

  • CFEC has returned over $29 million+ in capital credits since its founding.
  • In recent years, the Board has made great progress catching up on older years, working toward present-day distributions

Why Capital Credits Matter

Capital credits reflect one of the 7 Cooperative Principles: Members’ Economic Participation.

  • Members build equity in the cooperative.
  • Surpluses are returned to members or reinvested in the co-op.
  • It’s a benefit unique to not-for-profit, member-owned cooperatives.

⚡ Bottom Line: Since 1939, CFEC has been committed to returning margins to its members whenever possible. Capital credits are your proof that we’re not-for-profit, community-owned, and always working for you.

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