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Capital Credits

When you signed up to receive electric service from South Central Indiana REMC, you became a member and an owner of an electric cooperative. While investor-owned utilities return profits back to their investors, electric cooperatives give margins back to the member-owners in the form of “capital credits.”

Please make sure to keep your mailing address up-to-date, even if you no longer receive electric service from SCI REMC, so that you will receive any future capital credit retirements.  

If you have additional questions about capital credits, please e-mail us.



Q: What are Capital Credits?
A: South Central Indiana REMC is a not-for-profit, member-owned cooperative. Capital credits are what set Cooperatives apart from Investor-Owned Utilities (IOUs). While IOUs try to earn profits to give back to their investors, Cooperatives work hard to provide their electric service as close to cost as possible. Any margins, revenues less expenses, at the end of the year are allocated to our Member-Owners in the form of Capital Credits.

Q: When do you return Capital Credits?
A: Annually the Board of Directors evaluates the financial position of the Cooperative and determines whether to pay back capital credits (generally in the last quarter of the year). Then the Board determines which Capital Credits from what year(s) will be refunded.
(We work to give capital credits to long-term members and newer members at the same time, so people aren’t waiting decades for their credits.)

Q: What do I have to do to get Capital Credits?
A: Nothing. By purchasing electricity from SCI REMC, you are automatically considered a member, and an owner, of the Cooperative. At the end of the year, margins are allocated to each member that purchased electricity that year proportionately based on their electric purchases. SCI REMC keeps a record of capital credits for each member for each year to be paid back at a later date. Annually the Board of Directors evaluates the financial position of the Cooperative and determines whether to pay back capital credits. Then the board determines what years, if any, will receive a capital credit refund that year. 

Q: I’m moving will I still get my Capital Credits?
A: Yes! You will are entitled to Capital Credits earned while you were a member even after you move off of our lines. It is important that you always provide us with your current mailing address.

Q: How many years of Capital Credits have you paid back to members?
A: Capital Credits from Operating Margins have been paid back 1939-1988 and 1994-2016. (Since 2002, we have paid more than $5 million in Capital Credits to members.)



  • Operating Costs: The cost to maintain, repair and construct the electric system (poles, wires, substations, etc). 
  • Margin: At the end of the year, SCI REMC subtracts operating expenses from the amount of money collected, and the balance is called the margin. (This is similar to “profits” at IOUs.) 
  • Allocate/Allocation: An approved method used to assign the margins to an individual’s capital credit account. 
  • Patronage: At the cooperative, your patronage is the amount of money you paid on your electric bill each year. 
  • Retire/Retirement: A payout from your capital credit account. The cooperative withdrew money from your capital credit account and sent you a check based on the board’s approval of capital credit retirement.


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