[8/18/21] BPA Price Cuts To Hit Okanogan PUD

Posted in Public Utility

The Okanogan PUD says power rate cuts from the Bonneville Power Administration will cost it at least a million dollars.

Although BPA will implement historic power rate decreases, the Okanogan PUD will also receive less power, which they will have to replace at a higher price on the open power market.

BPA announced earlier this summer that it would reduce power rates for the first time in decades by an average of 2.5%, and reduce its transmission rate increase to an average of 6.1%. The new rates are effective Oct. 1.

For Okanogan PUD, which purchases about two-thirds of its power from BPA, the price reduction will mean some savings, but the PUD will also lose more than 16 thousand megawatt-hours of power for the year. The only way to recover that power is through sales on the open market, which are, on average, twice what the PUD would pay to BPA. Staff expect it to take at least $1 million to replace those megawatts, more than what the savings would be in the reduced rates. Most of the megawatts to be replaced occur during times of high demand, when the power on the market is even more expensive.

The reduction in megawatts comes due to fish passage mitigation measures, which allows for less power production across the BPA system.

The BPA’s 6.1% transmission rate increase will also cost the PUD about $160,000 more for the year.