These capital credits help provide the equity needed to build and maintain the electric system that serves our communities. The poles, wires, substations and equipment that deliver reliable power require significant investment. By retaining capital for a period of time, the cooperative can reduce its reliance on borrowing, maintain financial strength, and continue investing in the infrastructure our consumer-members depend upon every day.

When the Board of Directors determines it is financially prudent, a portion of those capital credits is retired and returned to consumer- members. Historically, many electric cooperatives, including Halifax EMC, have followed a “first in, first out” approach, retiring the oldest capital credits first over a period of 20 years or more.

As part of a recent change in bylaws and policy, the cooperative may retire a portion of capital credits from all outstanding years, rather than concentrating retirements solely on the oldest outstanding years. This approach allows a broader group of members to participate in capital credits retirements while still maintaining the financial strength needed to serve the membership.

This change is significant because it allows consumer-members to participate in capital credit retirements sooner. Under the previous approach, many consumer-members would wait decades before seeing a return of their allocated capital. By retiring a percentage of all outstanding balances, active consumer-members are more likely to receive capital credit retirements throughout their membership rather than only after many years have passed. The Board’s stated objective is to allow consumer-members to participate economically while still receiving service, all while maintaining the liquidity and financial strength necessary to operate the cooperative responsibly.]

What is not changing is the fundamental principle behind capital credits. They remain one of the defining features of the cooperative model. They represent each member’s ownership in Halifax EMC and reflect our commitment to operating for the benefit of the people we serve, not for outside investors.

What is not changing is the fundamental principle behind capital credits. They remain one of the defining features of the cooperative model.

As we continue to grow and adapt to the changing energy landscape, it is important that our policies also evolve. These changes are designed to provide greater flexibility, strengthen the cooperative’s financial position, and ensure that capital credit retirements remain fair and sustainable for current and future generations of consumer-members. The revised bylaws
establish the framework for how capital credits are allocated, retired, and administered, while allowing the Board to make prudent decisions based on the cooperative’s financial condition and long-term needs.

If you’ve been a Halifax EMC member for more than one year, you may receive a capital credits retirement this December. These funds will either be applied as a credit to your December bill or sent to youby check through the mail. As mentioned earlier, the goal of this bylaw change is to increase participation in capital credits and allow consumer-members to receive their share of cooperative margins earlier in their membership.

‘At Halifax EMC, we believe the cooperative difference matters. Capital credits are more than a financial transaction. They are proof that our consumer-members are owners, and that the success of the cooperative ultimately belongs to the people who power it every day.