Nearly $1.8 million paid out to Fall River Electric customers
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The following is a news release from Fall River Electric.
ASHTON – This month, Fall River Electric Cooperative is mailing cash-back checks to more than 9,000 of its owner-members (customers), totaling nearly $1.8 million as part of its patronage capital program.
Fall River Electric operates as a nonprofit cooperative, and is owned by the customers it serves. When revenues collected by the co-op exceed operating costs, those extra revenues become patronage capital, which is then disbursed to its owner-members on an approximate 20-year cycle. This retirement cycle helps the Cooperative achieve its ideal equity level, which also helps the co-op obtain loans at lower interest rates and keep electric rates to members low.
Unlike investor-owned utilities that pay profits to stockholders, Fall River Electric’s patronage capital is a customer’s investment in the Cooperative and is used for building new or maintaining existing infrastructure, including generation facilities, poles, wire, transformers, and substations. These cash-back payments are especially welcome by members in advance of the holiday season and can be likened to an infusion of capital into our area’s economy.
The amount of cash-back a member receives is based on how much electricity they purchased during the year being retired. This year, members are receiving patronage capital earned during a portion of 2007.
“These cash-back payments made to our customers are one of the most unique benefits of being a member of our Cooperative,” Fall River Electric’s CEO/General Manager Bryan Case says. “We are the only electric utility in eastern Idaho that pays our customers back for their equity in the Cooperative.”
“Our staff and management are laser focused on managing our financial and physical resources to the extent that this year our equity ratio is the highest it has ever been in our 87-year history, at 56%. A strong equity base is a significant factor to our board’s ability to retire patronage capital to the Co-op’s owner-members,” Case adds.
During Fall River Electric Cooperative’s history, the Co-op has paid members over $37.2 million in patronage capital. To learn more about Fall River Electric’s patronage capital program, click here.