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Opinion BPA rate hike too much for this economy
BPA rate hike too much for this economy
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Oregon Trail Electric members might need to brace themselves for an
increase in electricity rates later this year. The Bonneville Power
Administration served notice in February that, for the first time in
six years, it would likely need to increase its wholesale power rates
in the new fiscal year that begins Oct. 1. The BPA estimated that the increase could amount to an average of 7-8 percent. Its wholesale customers, which include public utilities and co-ops like OTECC, would then have to pass on the increase, or much of it, to customers. It would amount to one more economic whammy to consumers, many of whom are jobless or working reduced hours. BPA claims the increase will be necessary because of what it calls “four primary drivers’’: • Cost increases for operating the Columbia Generating Station nuclear plant due to needed improvements. • The cost of projects to boost protection and survival of salmon, which we assume includes the $7 million BPA recently awarded to overhaul an outdated fish ladder on the Klickitat River as part of a project with the Yakama Nation, the state of Washington and the Forest Service. • Reduced prices for surplus power sales due to the downturn in the economy, which is exacerbated by poor water conditions in the Columbia Basin. • And increased cost of operations and maintenance of the hydropower system. While BPA Administrator Steve Wright says that “the investments we are making in infrastructure and the environment will create jobs in the region,’’ the reality is that a large rate increase like the one proposed will also cost jobs in the region, especially during a recession where many industries are teetering on the edge. The impact will be even more in hard-hit regions like Northeast Oregon. BPA needs to carefully review its infrastructure and environmental needs in light of the economy and decide if some could be delayed. A large rate hike when times are tight doesn’t make much sense, not for BPA and certainly not for the region it serves. |
