At its annual business meeting on Aug. 8, Community Electric Cooperative shared with members the highlights of a successful 2022 that featured strong safety and reliability performance. CEC leaders also announced their belief that, toward the end of this year, the Cooperative again will be able to return money to members in the form of capital credits.
“Community Electric is operating at high levels of service, safety, productivity and efficiency,” CEC President and CEO Steven Harmon said. “I commend our staff for its dedication to our mission and our members. And I am delighted that, in these challenging economic times, we anticipate that we will be able to return revenues we’ve received that, based upon our latest projections, will exceed the funds needed to operate on our members’ behalf this year.”
A year ago, Community Electric “retired” capital credits totaling nearly $360,000 in payments to members. That allotment brought CEC’s cumulative retirement of capital credits over the years to nearly $20 million. Very soon, your board of directors will review the Cooperative’s current financial position and a projection of its financials through 2023 and consider additional general refunds of capital credits to be accomplished later in the year. The amount of the credit provided to any specific member will vary depending upon the amount of electricity the member used and the rate at which the member was billed.
Capital credits are a unique feature of the rural electric cooperative structure. Cooperatives function with a federal tax-exempt designation and, to help retain that status, operate on an at-cost basis that includes returning “excess” revenue to its member-owners in the form of money or a credit on their electric bills. The process ensures that the cooperative has the funds necessary to serve its members while ensuring that the members — as owners — pay into the system only the amount of money necessary for the system to operate properly.
“Community Electric looks to be in a strong position financially,” Board Chairman Jeannette Everett says. “This is no small achievement. Costs are up; supply chains have been disrupted, and the transition to a cleaner energy infrastructure is continuing if not intensifying. Families need every dollar they can get to make ends meet, and I commend Community Electric’s employees for recognizing they have an obligation to serve our members cost-effectively. This is one more example of why and how the Community Electric Cooperative is such a special organization.”
During the business meeting — Chad Fowler, Robert B. Jones, Sr., John W. Stewart were reelected to the board. Attendees consisted of 25 LIVE virtually and five physically present and over 400 total views — CEC’s leadership discussed the Cooperative’s performance in several key areas:
Safety. Applying lessons learned over the prior two years, CEC successfully navigated the COVID pandemic without the occurrence of significant incidents. CEC was awarded recertification as a safety-accredited cooperative through the National Rural Electric Cooperative Association headquartered near Washington, D.C. This process ensures that CEC employees follow the proper safety procedures in the office and in the field to keep members and co-workers safe.
Reliability. CEC achieved high reliability despite periodic disruptions. The Average System Availability Index measure for the year was .9814.
Member Satisfaction. Community Electric continues to earn strongly positive assessments for service reliability, rate structure stability and team member responsiveness. The latest Member Satisfaction survey, conducted by Cooperative Insights, showed an approval rating of 89, an excellent score that surpasses the Virginia electric cooperatives’ average of 86 and the national cooperatives’ average of 74.
Financial Accountability. The strong performance of CEC’s energy solutions subsidiary, RECORE, helped drive the Cooperative’s positive financial outlook. In December 2022, RECORE declared and paid the Cooperative a dividend ($400,000) for the sixth consecutive year. CEC ended the year with a consolidated net margin of $636,428, more than 2.5 times higher than the budgeted margin of $233,780. The balance sheet grew to $59,287,075. Nearly 6% higher than 2021’s total consolidated assets of $56,049,054.
“All the way around, Community Electric had an outstanding year and provided us tremendous momentum to continue serving our members with excellence throughout 2023,” Harmon says. “We strive to serve our members at a high level each and every day, knowing that we always can do just a little bit better tomorrow than we’ve done today. We live in a great part of Virginia, and we have a lot of terrific people and partners helping us along the way. Members first — every day.”
Thank you to the incredible sponsors: River City Construction, Helena Agri Ent LLC, Briggs & Stratton, TEMA, TMS, Koppers, Special Fleet, Fastenal, Dewitt’s, Xylem, and QDaddys.
–Report by Jessica Parr, Manager of Communications, Community Electric Cooperative.