News CenterAll news
PUD Approves Budget / Rate Increase
Clallam County PUD #1 (PUD) Commissioners voted to approve the 2016 Budget during the December 14, 2015, Commission Meeting. As part of that budget approval, Commissioners approved a staff recommended 3.8% increase in retail electric utility rates and a 6% retail rate increase for water and sewer customers.
Electric Rate Increase
“This electric rate increase is consistent with our strategic objective of maintaining stable rates and financial responsibility to our customers,” says Doug Nass, PUD General Manager. “And while rate increases are not something customers want, they are necessary given current rate pressures. Even with the rate increase though, we are fortunate to have amongst the lowest electric utility rates in the state and country.”
The retail electric rate increase is equal to about $4.20 per month for the average PUD residential customer, using 1200 kWh per month. The actual retail electric rate increase will be applied as an increase of $2.50 per month on the customer’s base charge and approximately 2% on kilowatt hours used, which all totaled is approximately 3.8% overall.
Example of an average electric bill: Current $110.10; with the rate increase it would be $114.29
Electric Rate Pressures
For Clallam PUD, weather is responsible for almost all usage and revenue variations. Both 2014 and 2015 have been unseasonably warm, which has resulted in a significant revenue decline. Other rate pressures include anticipated Bonneville Power Administration wholesale rate increases of approximately 8% each biennium, the added costs of meeting the mandates of Washington’s Energy Independence Act (formerly known as I-937), and personnel costs that include escalating health care costs as a result of federal legislation.
In October 2015 the Bonneville Power Administration (BPA) increased rates by approximately 6%. This represents the largest cost center for the PUD at about 44% of the total budget. Staff and Commissioners decided to divide extension of this rate impact over the course of 2 years instead of just one, which keeps with the philosophy of providing stable rates. Additional BPA rate increases are expected in 2017 and 2019.
Water Rate Pressures
The PUD’s Water System faces challenges related to aging infrastructure, limitations on capital financing, and regulatory mandates.
“The Water Utility is separate from the electric utility and it is must be managed as such. With a smaller customer base and aging infrastructure, these rate increases are necessary to not only maintain the system but also to make certain we are able to deliver the quality water expected,” says Doug Nass.
The water system rate increase was approved at 6% for the next year.
Example of an average water bill: Current $42.00; with the rate increase it would be $44.50
The PUD’s Sewer systems are similar in challenges to that of the Water System. The sewer system rate increase was approved at 6% for the next year.
Example of an average sewer bill: Current $40.00; with the rate increase it would be $42.40
Total Customers in each utility: Electric, 30,000; Water, 5000; Sewer, 60
The approved electric retail rate increase will be effective on all bills rendered on or after April 1, 2016, which includes all usage since the customer’s prior bill. The water and sewer retail rate increases will be effective on all bills rendered on or after February 1, 2016, which includes all usage since the customer’s prior bill.