WHAT ARE CAPITAL CREDITS?
As a member of an electric cooperative, you invest in LREC through your revenue contribution. Each year, any margin (revenue after expenses) earned by LREC is reinvested in the cooperative. At the same time, LREC’s margin is proportionally allocated, based upon your share of revenue during the year, and recorded to capital credit accounts for each of the members. These accounts are maintained until the credits are retired (paid) in full. Capital credits represent each member’s ownership interest of the cooperative.
Information on 2025 Capital Credit Allocation
For the first time since 2012, there was no LREC operating margin available to allocate for 2025. Several factors contributed to this decision, including rising operating and maintenance costs which reduced our year-end margin. In 2025, we utilized the remaining deferred revenue balance, helping us maintain positive financial results. That being said, our Board of Directors was able to approve an allocation of $3.57M from our wholesale provider Great River Energy.
Additional detail regarding deferred revenue can be found by referencing the July 2026 NewsFlashes.