Southern Maryland Electric Cooperative (SMECO) is issuing capital credit refunds totaling nearly $3 million. The general refund amounts to approximately $1.52 million and the special refund to estates of deceased members and to unpaid final bills is $1.44 million. The general refund will be issued beginning in mid-July as a credit on customer-members’ bills.
According to Austin J Slater, Jr., SMECO president and CEO, “Our favorite time of year is when we issue capital credit refunds. Our customers realize the benefit of being electric cooperative members when they receive a portion of the co-op’s margins as a credit on their bill. When we pass savings on to customers, we demonstrate the value of the cooperative business model, and that differentiates us from other energy companies.”
SMECO’s margins for 2014 totaled $8,428,000. Because SMECO is a cooperative, margins—revenue minus expenses—are retained to provide working capital for new construction and system improvements. Margins are refunded to customer-members in the form of capital credits when SMECO’s Board of Directors determines that the co-op’s financial conditions can be met.
All active customer-members will receive a credit on the bill for their primary account. If customers wish to contact SMECO to designate their primary account, they may call 1-888-440-3311. Inactive members will receive a full refund of the balance in their capital credit account if the balance is $100 or less. Capital credits are used to pay any amount due if a customer had an unpaid final bill for electric service.
Each member’s share of the co-op’s margins is based on how much electricity the member purchased and the rate at which the account was billed. SMECO is a customer-owned electric cooperative providing electricity to 130,000 members with 160,000 services in Charles County, St. Mary’s County, southern Prince George’s County, and all but the northeast portion of Calvert County. Co-ops are distinctly different from investor-owned utilities because co-ops are owned by their customers, and customer-members elect the men and women who serve on the Board of Directors.