Manager’s Message

Michael (Mike) Heise

President and Chief Executive Officer of Cloverland Electric Cooperative.

Capital Credits the Cooperative Difference

As a member of Cloverland Electric Cooperative, you have a share in our margins, in the form of capital credits. This capital credit retirement reflects the contribution of capital to the cooperative during those years. Over time, those funds helped Cloverland stabilize rates and reduce the amount borrowed to build, maintain and expand the distribution system providing our members with safe, reliable electricity. It also helped to build and sustain the cooperative in an industry experiencing massive changes and technological advances.

This year, your Cloverland Electric board of directors budgeted for the retirement of $750,000 in capital credits to members who purchased electricity in 1996 and 1997.

How do capital credits work?
After taking all expenses into account, any would-be profits left over when we close our books each year are considered margins. While investor-owned utilities return a portion of any profits back to their shareholders, electric co-ops operate on a not-for-profit basis. So instead of returning leftover funds, known as margins, to folks who might not live in the service territory, same region or even the same state as you do, Cloverland allocates and periodically retires capital credits based on how much electricity you purchased during a year. It’s a major difference between a cooperative and other types of utilities.

The amount of margins allocated to each member as capital credits is based on how much electricity you used in that year. Eventually, the capital credits are retired and paid back to the members. Active members receive a credit on their bill, while members who no longer live in our service territory receive a refund check.

Our commitment to members
Cloverland’s board of directors is committed to retiring capital credits. While margins are allocated back to members every year, the board is responsible for determining the timing and amount of capital credits to retire based on the financial health of the cooperative. The board and staff at Cloverland worked to implement sound strategies aimed at increasing the equity threshold required to retire capital credits without impacting member rates.

Keep us informed
When you move or no longer have service with Cloverland, it is important that you provide us with an updated address to ensure future capital credit refunds can be mailed to you.

Also, remember you must be a member and have service in your name to have capital credits allocated/retired to you. If you are receiving electric service in someone else’s membership or the service is in the name of a deceased person, you will not receive capital credits. Capital credits are non-transferrable and any current or future capital credit retirements will be issued in the name of the person on the membership or the estate of a deceased member.

Support Cloverland Cares
Last year, we established the ability to donate capital credit retirements to Cloverland Cares. We are thankful to all the members who have committed current and/or future retirements. If you would like to donate your future retirement to support Cloverland Cares, visit

Kind regards,
Michael (Mike) Heise

By The numbers