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PUD Customers to See Rate Increases in 2014 by Amelia Dickson The Daily World, November 19, 2013

Grays Harbor PUD customers could see a 5.5 percent rate increase next year to mitigate rising power costs from the Bonneville Power Administration, according to a draft budget put together by PUD officials. The draft was presented at Monday's PUD Commission meeting, and will be finalized later this year.

Doug Streeter, chief financial officer for the utility, said he expects the PUD's power costs to increase by about $1.8 million in the next year, largely the result of the Bonneville Power Administration, a federal agency that supplies much of Grays Harbor's power, raising rates earlier this year.

Bonneville increased power rates by 9 percent and transmission rates by 11 percent in October. In an August press release, BPA officials said the rate increase is the result of increased maintenance and operations costs, as well as the cost of funding fish and wildlife mitigation programs.

Bonneville Power Administration is the PUD's largest supplier, but state and federal regulations mandate that some of the utility's power come from renewable sources, such as wind farms.

"We know that's going to seem like a lot, but we're doing what we can," Streeter said.

Customers won't likely see the full increase in January, Streeter said. The rate increase will be broken in two, with a 3.75 percent increase in January and a 1.75 percent increase in July. With the full 5.5 percent increase in place, the average customer will pay an extra $5 each month, the utility estimates.

PUD officials also discussed the utility's capital budget -- a projected $12.26 million in expenditures over the next year. Chief Operating Officer Wes Gray said the various projects will be necessary measures to maintain the system. "Lower priority projects will be pushed out into coming years if they're not critical for our reliability and safety of our system," he said.

About $1.4 million could be spent on transmission, including line improvements, line replacement and the construction of access roads so crews can easily tend existing lines. The utility could spend about $1.75 million on substation improvements, including the replacement of obsolete equipment and the replacement of a transformer that was damaged in a lightening storm.

The utility could spend about $4.7 million on the power distribution system, including system expansions and additions, new transformers and new meters. About $4.3 million could be spent on general plant funding, including a replacement of customer information software, new meter data management software and new utility vehicles.

Dave Ward, general manager of the utility, said he and the other officials are considering stretching larger projects between 2014 and 2015 so cost to each budget will be smaller.

The proposed capital budget is significantly larger than the 2013 capital budget, which was set at about $7.5 million.

Commission President Russ Skolrood said he and other officials purposely created a small budget after former General Manager Rick Lovely announced his retirement.

"We didn't want to stick the new guy with anything too big," Skolrood said.

Ward said he still hopes to eliminate some unnecessary costs and whittle down the capital budget.

"Remember, this is still a preliminary number," Ward said. "We're still paring it down. But we're not aiming for 7.5 million."