The Bonneville Power Administration is proposing to raise its wholesale power rate by 3.5 percent and increasing transmission costs by 1.1 percent for the years 2018 and 2019.
The BPA is a federal agency that sells hydropower and transmission services to 142 public utilities in the Pacific Northwest, including to Clark Public Utilities. Clark PUD, which is not yet planning its 2018 rates, says customers likely won’t see an increase in 2017.
“The BPA rate increases are every two years and our budgeting is annual. The proposed 2017 Clark Public Utilities budget does not indicate a rate increase. And rates have not increased since 2011,” said Clark Public Utilities spokeswoman Erica Erland.
Clark buys about 60 percent of its power from the BPA.
The BPA’s rate-setting process starts this month. A decision is set for July. The new rates will take effect Oct. 1, 2017.
After the proposed increase, the wholesale power rate would be $33.75 per megawatt-hour.
The BPA says half the increase is necessary because of higher program costs, including the operating and maintenance fees it pays other agencies to run hydropower facilities, and the rising costs of fish and wildlife mitigation.
The other half is caused by lower predicted sales due to a declining load loss — utilities with more efficient plants don’t need to buy as much to make up for loss — and a projected slight decline in power generation by private utilities, which pay the BPA to deliver that power.
Many BPA customers will see a lower proposed rate increase, 2.3 percent, because of a one-time credit resulting from savings related to the Regional Cooperation Debt transactions initiated in 2014.
The transmission services rate will rise 0.5 percent annually. The BPA says that is less than the rate of inflation, but still enough to provide reliable transmission service to customers and invest in substantial capital projects in 2018-19.
In order to strengthen its financial health and credit rating, the BPA is proposing a policy to build financial reserves to targeted levels.
“BPA is committed to working with customers and other constituents to identify additional cost-management alternatives through the IPR 2 process,” said Elliot Mainzer, the BPA’s administrator and CEO.
