BPA seeking 7 percent hike in electric rates
Officials point to higher costs and lower sales of surplus power
PORTLAND – The Bonneville Power Administration says it needs to raise its rates by 7 percent to 8 percent, beginning in October.
The agency provides more than a third of the electricity for the Pacific Northwest. It sells the power from 31 federal dams and a nuclear plant in the Columbia River Basin to more than 140 utilities.
Agency officials cite increased costs, including expenses for salmon recovery programs, and a decline in sales of surplus power outside the region. The surplus power sales can amount to a quarter of the agency’s revenues, and they subsidize rates in the Northwest. Sales have been hurt by the recession and low water.
The proposed rates are subject to a public review and a final decision in July.
Scott Corwin, executive director of the Public Power Council, said the increase came as no surprise, but any increase is painful in the current economy.
“We’ll pursue it in BPA’s process and see if we can get it lower,” he said.
BPA Administrator Steven Wright said the rate proposal also reflects a need to invest in the region’s power infrastructure. He expects capital investment not only in the existing hydropower system, but also in the Columbia Generating Station nuclear plant and in fish mitigation programs.
“The investments we are making in infrastructure and the environment will create jobs in the region,” Wright said.
The proposed rates include $183 million in annual payments to residential and small farm customers of investor-owned utilities in order to share the benefits of the low-cost federal hydro system. The residential exchange payments have been the prize in a lengthy tug of war between public and investor-owned utilities.
Under an agreement reached last year, public utilities will receive paybacks of past overpayments made to the investor-owned utilities equivalent to $72 million in 2010 and 2011.