.png)
Don Gronning
Opposition to rate increase
NEWPORT – The Pend Oreille Public Utility District should use some of its hefty cash reserves instead of increasing rates. A rate increase would be a strain for the county’s senior population. The PUD should sell its fiber optic service.
Those were some of the suggestions from the public at the PUD’s rate hearing Tuesday, March 3 in Newport. The full house heard a presentation from PUD staff recommending a 3% overall revenue increase spread over all its services. The electric rate increase would amount to about $4 a month for the average residential customer, said Sarah Holderman, director of customer service for the PUD.
According to Holderman’s presentation, the electric rate increase would raise $635,000. An increase from $0.0660 per kilowatt hour to $0.0687 per kilowatt hour would amount to $3.92 per month for the single phase residential customer.
She said small incremental increases are needed for long-term PUD costs.
By 2030, the PUD’s power costs will go up by more than $4 million because of contracts and the state Clean Energy Transformation Act requirements.
“If we wait until 2030 to make an adjustment, it’s going to be over 20% to increase revenues enough to cover that additional cost,” she said. “By planning ahead, making smaller adjustments, it will be easier for our customers and be better for the community.”
Holderman said even with a 3% increase, the PUD’s cash balance would be drawn down. She said the PUD plans to spend $45 million over the next 10 years on new substations and to upgrade its infrastructure. It has roughly $70 million in unrestricted cash reserves.
“We know we have cash, but we are using it,” she said. Holderman also proposed policy changes to the reconnect fee for customers who leave the area for a time. She said some customers didn’t disconnect their service because the $275 field reconnect fee cost more than paying the monthly service availability charge. Since most customers are now on smart meters they can be connected and reconnected remotely for $30. The language she proposed was that customers requesting a reconnection of service shall be responsible for paying all applicable Service Availability Charges that would have been incurred during the months the service was disconnected, not to exceed 12 months. That monthly service availability charge is $35.55 per month.
“The intent of the service availability charge is to recover the fixed cost of providing service to our customers,” she said, things like infrastructure.
Before the hearing started, Ernie Hood made some comments and presented commissioners written comments. He said senior citizens made up 30% of the county’s population.
“So any rate increase is going to impact us as retirees,” he said.
He also asked the commissioners to consider a zero based budget. A zero based budget would require all expenses to be justified before a budget is adopted.
In his written comments he suggested the PUD adopt a tiered rate model in which the first 800 kWh would be tier 1 and priced lower than tier 2, which would be from 801 kWh to 2,000 kWh. Tier 2 would include most customers. He recommended higher use customers be charged more.
Hood also asked that the Service Availability Charge be reduced to $25. He pointed out that Ferry County charged $20 a month for service availability.
Hood also recommended aggressive internal cost cutting and enhanced senior and veter- an assistance.
Former Pend Oreille County Commissioner Mike Hanson said the county was impoverished. He said in his opinion the PUD didn’t need a public information person. “We need to be hearing from our commissioners.” He also said technology may be a way to reduce the number of PUD employees.
Former PUD commissioner and employee Joe Onley said that the PUD needed to spend some of its cash reserves before raising rates.
“I think customers basically want to know how much money of theirs is in the PUD’s pocket,” Onley said. “I think it’s close to $10,000 per customer. Does it really need to take any more with a rate increase based upon the PUD financial crystal ball?”
Richard Bevans said that the PUD’s fiber optic internet should be sold.
“The fiber side is a loser,” Bevans said. He said the small amount of customers in the county meant the fiber costs would continue to increase.
“So the simple solution is instead of trying to do a rate increase, we need to sell it,” he said. He said satellite internet could take its place.
An online commenter said that after the smart meters were put in, she saw substantially inaccurate electricity readings. “And we had not changed our usage whatsoever,” she said.
She said she works with the public and even a small rate increase wasn’t realistic with the amount of poverty in the county. She said there wasn’t enough assistance available.
She said she was appreciative of the $250 her college student daughter received, from the PUD but her daughter wasn’t able to apply for energy assistance through the Rural Resource Energy Assistance program because “their system never opened.”
Other commenters mentioned how much electricity Merkle Standard required.
PUD Finance Director April Owen said Merkle Standard pays for all infrastructure costs they incur. She said they prepay for all the electricity, most of which is bought on the open market.
Public comment can still be made by email at info@popud. org through March 16. PUD commissioners are scheduled to act on the rate increase March 17.
