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for your home AND BUSINESS
Capital Credits On the surface, it might be difficult to understand what makes an electric co-op different than another type of business. Because a cooperative is a business, but it operates differently than many other types of businesses. The most important difference is that you and everyone else that receives electricity from the cooperative are not just customers—you collectively own the business as members. One of the most important differences between electric cooperatives and for-profit utilities is that co-ops are headquartered right here and hire local people. Co-ops are also locally managed and overseen by boards made up of members just like you. The electricity we provide may be generated further away, but the people who do the administrative and technical work necessary to serve you live here. The directors who make the long-term decisions about how the business is run are from here. And you elect those board members to represent you. Another difference is that cooperatives are nonprofit entities. There are no stockholders and no dividends paid to investors who don’t live in our service territory. When the co-op collects more revenue in a year than it takes to pay its bills, what’s left after covering operating expenses will eventually be refunded to members. But first, the co-op uses that money, referred to as capital credits, to invest in the business and maintain an emergency reserve. A few years down the road, when financial circumstances warrant, the co-op may opt to return that excess capital to its members in a capital credits refund. Those refunds are given back to members in proportion to the amount of business they did with the co-op in a given year. This year, $1.5 million will be distributed back to NEC 20
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Retail non-wires members in the form of capital credits. Because capital credits can exist on the books for several years before the retirement of those dollars, it’s important to update NEC with your new address if you move. The refunds are still yours, even if you are no longer a member. Electric cooperatives exist to serve communities in our territories with reliable, affordable power. But we also act to enhance the quality life in those communities. That’s the cooperative difference. See page 27 for more information on how NEC Retail is giving back to members with the Power Perks Adjustment.
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2017
Christmas Card Contest RULES:
Entries must be hand-drawn and follow the contest theme of combining electricity or lineworkers with a Christmas or holiday component. All entries must be received by 5 p.m on Friday, January 13. All submitted works must be an original concept and not a copy of anyone else’s copyrighted material. If your image infringes upon another’s copyright, it will be disqualified. Upon submitting your work to NEC for this contest, you are solely responsible for any infringement on copyrighted materials. Artwork must be delivered to the NEC offices or emailed in a JPG format that does not exceed 1MB. This page must also be completed and returned with the artwork submission to be considered a complete entry. All artists must be dependents of a current member of Nueces Electric Cooperative. Children 18 and under are eligible to participate. One grand prize winner and one runner up will be determined in each of the three age categories, listed below. Winners will be annouced in the March edition of Texas Co-op Power magazine. The three grand prize winners will each receive a $100 electric bill credit and a $100 Wal-Mart gift card. The three runner ups will each receive a $50 electric bill credit and a $50 Wal-Mart gift card. NEC will also determine which of the winners’ artwork will be featured on the 2017 NEC Christmas Cards. Visit NuecesElectric.org for the submission form.
Three $200 GRAND PRIZES
Christmas Card Categories 6 & Under
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7 - 12
13 - 18
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2017
Youth Leadership Tour Win the trip of a lifetime!
The Govenment-in-Action Youth Leadership Tour 2017 is an all-expense-paid trip for high school students to learn about different aspects of the government, meet their members of Congress and visit historical sites. Each year, NEC sends four delegates from the cooperative to participate. This year’s trip will begin in Austin, Texas on Wednesday, June 7 and continue on to tour sites in Washington D.C. before the trip concludes on Friday, June 16. The travel package, valued at $3,000, includes air transportation to and from Washington D.C., hotel stay, meals, admission fees, and $250 cash for extra expenses.
Essay Topic: Choose one of the Seven Cooperative
Principles and explain how NEC embodies that principle.
Application Deadline: January 31, 2017
Complete the 2017 Nueces Electric Cooperative Youth Leadership Tour Application form which can be found on both nueceselectric.org and necretail.com. Submit a 400-600 word essay on the topic “Choose one of the Seven Cooperative Principles and explain how NEC embodies that principle.” Finalists will interviewed to determine the final four winners that will take this Youth Leadership Tour trip of a lifetime. Applicants must have consent of and reside in the home with a parent or legal guardian who is a current Nueces Electric Cooperative member. 22
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Apply Today!
How to apply:
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Ramiro De la Paz Memorial
SCHOLARSHIP Nueces Electric Cooperative awards high school seniors of cooperative members scholarships each year. This year, there are three different types of scholarships that will be awarded. Students planning to attend a 4-year college or university in Texas are eligible to apply. Two Grand Prize scholarships of $4,000 and ten $1,000 scholarships will be awarded. Students planning to attend a 2-year college or vocational school in Texas for a career related to the electrical industry (GIS mapping, communications, engineering, etc.) are eligible to apply. Ten $1,000 scholarships will be awarded. Students planning to attend a Texas lineman’s college are eligible to apply. Two $5,000 scholarships.
nt s e r a r p bers u o , If y e mem o - op ar he C win d o f t co u l s h i p ! r yo u h o l a c as
Applicants must reside in the home with a parent or legal guardian who has been a Nueces Electric Cooperative member for a minimum of six months as of the application deadline date.
Two $5,000 scholarships and
Two $4,000 scholarships and
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For Applications & Details: www.necretail.com
Application deadline: February 10
Twenty $1,000 scholarships
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2016 Annual Memb By Sterlen Kemp
Nueces Electric Cooperative kicked off its 77th annual membership meeting on October 13, 2016 with a packed auditorium under the vibrant Texas sun. Fortunately, the Richard M. Borchard Regional Fairgrounds in Robstown, Texas, provided a cool arena for co-op members to celebrate their partnership with NEC. The red- and blue-shirted employees and volunteers opened the doors of the arena as members poured in by the hundreds. Approximately 2,000 people attended the meeting enjoying catered barbecue with family and friends, winning door prizes and fun times for the kids. “I am once again grateful to be with you for this annual meeting as a fellow co-op member and president of NEC’s Board of Directors,” said NEC President Brian Menking. “NEC is a trailblazer in the co-op world and with the acceleration of our technical developments in 2015, our activities continue to position us as a cutting-edge co-op and a leader in our industry.” Once inside, members made their way through the registration lines facilitated by NEC employees to register for their chance to cast their ballots for the board of director’s election. Tickets for deliciously catered barbecue dinners from Corpus Christi’s own Howard’s BBQ and Catering Company were given as members made their way through the venue line.
While folks registered to vote and others ate at tables prepared by co-op event coordinators, the Texas A&M Kingsville Jazz Combo serenaded the crowd with a fully-orchestrated jazz ensemble. Adjacent to the arena, a designated kid’s area was available for children to play and be entertained as parents looked on. The kids participated in arts-and-craft activities, jumped in the inflated bounce house and petted farm animals such a chick-
utes for the 2015 annual meeting were approved and Menking along with NEC CEO Trace McCuan reviewed the co-op’s business performance in 2016. “I was fortunate enough to join the NEC family in November of 2015 as Chief Executive Officer,” stated NEC CEO Trace McCuan. “Thank you to all of the members and employees that help make this co-op great, year after year. Our co-op had a strong 2015. I am committed to continuing to make this a successful, memberdriven co-op.” The total revenue for NEC was $87,371,228 with expenses of $76,954,298 and a net margin of $10,332,365. In 2015, $7.3 million was returned to members in the form of capital credits or an end-of-year credit previously known as the Merry Christmas credit, but known now as the Power Perks Adjustment. After counting all the votes, the election results were finally announced: Incumbent Tommy Ermis remains the director for District 6, incumbent Louis William “Bill” Hartman remains the director for District 7, incumbent Brian Menking remains the director for District 8, and incumbent Gladys Allen-Lippincott remains the director for District 10. At the end of the meeting, Chief Retail Officer Frank Wilson kept the crowd’s attention by announcing names for the electric bill credit drawings. A Yeti cooler and a grand prize of various appliances were also giving to winners.
“NEC is a trailblazer in the co-op world and with the acceleration of our technical developments in 2015, our activities continue to position us as a cutting-edge co-op and a leader in our industry.”
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- NEC Board President Brian Menking ens, ducks, rabbits, pigs, and goats in excitement. As the meeting began, President Menking called the meeting to order by introducing Pastor Jim Craver from Immanuel Lutheran Church of Alice who offered the invocation. The U.S. Navy color guard presented the American colors as the jazz band performed the national anthem in the background. Menking passed the microphone, after reciting the pledge of allegiance, to recognize special guests and NEC employees. The min-
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embership Meeting
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Giving back to communities is the co-op way As some of you might know, co-ops across the globe adhere to the same Seven Cooperative Principles that guide all of our decisions––from how we run the co-op, to how we engage with our local communities. Concern for community is the seventh principle, and it is one that all employees of Nueces Electric Cooperative value year-round. But during the holiday season, concern for community seems especially important. Electric cooperatives have a proud history of giving back. Here at Nueces Electric Cooperative, our duty is to main street, not wall street. Some of our community service initiatives include: Operation Round-Up, NEC’s Youth Programs and the Corpus Christi Relay for Life event. Nueces Electric Cooperative members help us give back, too. Through
the Operation Round-Up program, members can round up their energy bills to the next dollar amount, and the extra change goes toward Nueces Electric Charities which is dedicated to helping those in need, right here in our community. Nueces Electric Charities distributes grants twice a year, and the upcoming deadline to submit a grant application is January 1, 2017. For the application and more information, please visit NuecesCharities.org. We are thankful for the support that our membership gives us to help support these local organizations that benefit members and community on a local level. But the commitment of cooperatives is also global. Co-ops have donated equipment and sent line workers overseas so they can help bring power to thousands of people
Merry Christmas
who have never experienced the benefits of electricity. So many families go without on a daily basis and struggle to make ends meet. This struggle can be especially hard during the holiday season. There are many ways you can give back to the community that go beyond dollar donations. Take some time to go through your closets and find clothes that no longer fit or have lost their use and take them to your local Salvation Army, Goodwill or church clothing drive. Volunteer for a local food or toy drive, deliver meals to the sick and the elderly or simply make a meal for a neighbor in need. No matter how great or small the act, every time we give back, we strengthen our community. So take the time to give back this holiday season. You’ll be glad you did.
Our main office will open at 9 a.m. and satellite offices at 10 a.m. on Tuesday, Dec. 13 All offices will be closed Friday, December 23rd, and Monday, December 26th, for the Christmas holiday. We will also be closed Tuesday, January 2nd. We wish you a safe and Merry Christmas and a happy New Year!
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POWER What are NEC Retail Power Perks?
NEC Retail’s Power Perks is a fund NEC Retail maintains to protect members from possible extreme electricity price fluctuations in the Texas market. The fund is built throughout the year through an added charge on each kilowatt-hour purchased by NEC Retail members along with some funds generated by margins in our base rates. As a not-for-profit electric cooperative, NEC Retail must build up this fund and then use this fund within the same calendar year.
What is the difference in the merry christmas thank you credit and power perks adjustment?
These are the same program. As NEC works to find ways to help members lower their electric bills, NEC Retail realized that the true meaning of this fund was lost in the name “Merry Christmas Thank You Credit” and had become something it wasn’t - a gift credit on members’ bills. We decided it was important to bring the name back to one that better represents the purpose of the program, and so changed it to the new name “Power Perks Adjustment.”
why is the power perks fund needed? While there are many factors that impact electricity pricing, extreme pricing fluctuations usually occur because of one, or a combination of the following: (1) A dramatic change occurs in the price of commodity fuels used by power generation plants throughout the Texas market or nation. The dramatic changes in fuel price may be caused by many market events, but it usually boils down to a significant change in supply or demand of a commonly used fuel, like natural gas, used in the generation of electricity. (2) A dramatic change occurs in the demand or supply of electricity in the region. Regional electricity demand or supply is impacted when higher than normal electricity usage exists (e.g. warmer than normal weather), or if a reduction in available power generation resources exists because of an unscheduled maintenance issue at a power plant and/or because old plants close before new generation resources can be brought online to supply the market. In either case, the result is a higher cost of power for power suppliers like NEC Retail, and, in turn, higher bills for consumers. NEC Retail started this fund to protect its member consumers in 2009 after an extreme pricing fluctuation occurred in the Texas electricity market in May of 2008. www.necretail.com
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PERKS During this event, the wholesale price of electricity jumped to $4 per kilowatt-hour (kWh) - 25 times the average retail rate in the country. Prices exceeded the allowed rate of $2 per kWh for seven days and created extreme power costs for power suppliers across Texas, which in turn resulted in consumers’ extremely high electric bills. In 2008, NEC Retail spread these unusually high costs for its members over a three-month period, but the bills for members were still extremely high. Because of this experience, NEC Retail developed the fund (now called Power Perks) to better protect members and lessen the impact of such extreme pricing fluctuations.
how do i know when i’ve received power perks? You will see a credit on your bill identified as a “Power Perks Adjustment.” This fund protects members from extreme electricity pricing spikes. The funds can be used anytime during the year to stabilize members’ electric bills if the market has an extreme pricing fluctuation. In December, any amounts of this fund not used during the year to stabilize rates, are returned to Retail members in an end-of-year Power Perks Adjustment (bill credit).
will nec retail always have the power perks program? As an electric cooperative, we exist only to serve our members and not to make a profit. Serving our members by helping them manage their electric bills is always a top goal for us. The risk of a dramatic market price fluctuation impact for our members is significantly less than it was when this fund was first created in 2009, thanks to recent actions taken to protect members. The Board and Management see both less need for this fund today and an opportunity to reduce the amount charged to our members to build the fund each year. In order to ensure members receive the best electric rates possible, NEC Retail expects to continue to reduce the amount of the Power Perks fund into the future and could possibly eliminate the fund eventually.
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