Two nights after the Jefferson County Public Utility District discussion on smart meters drew a vocal crowd, its Nov. 1 meeting on proposed electricity rate increases drew a smaller crowd to the same location in Chimacum.

Gail Tabone, with EES Consulting, explained that the proposed budget for 2018 requires an overall increase in revenues of $1.6 million, or 4.8 percent for the year.

There are a number of proposed rate increases, depending on the category of consumers, with the basic charge for residential customers going from $14.50 a month to $18.50 a month effective in January and another incremental rate increase in April.

PUD officials say the proposal, if approved by commissioners, would mean a typical residential customer using 1,200 kilowatt hours (kWh) of power would pay $135.62 a month starting in January, up 5 percent from the current $128.98 a month.

Because the PUD purchased the power system in East Jefferson County in 2013 from Puget Sound Energy (PSE), PUD officials also calculated how much people would be paying if PSE were still the power provider in East Jefferson County. PUD officials estimate PSE customers now are paying $131.04 for 1,200 kWh of power, and that there is a proposal that would increase that to $139.25 a month.

Tabone elaborated that the overall budget increase of 4.8 percent would allow all construction in progress to be funded from the PUD’s rates or reserves, and would continue funding for its low-income energy assistance programs.

From the 2017 overall budget of $31,537,594, this would bump up the forecasted budgets for 2018 and 2019 to $33,869,494 and $35,938,941, respectively. However, these same projections would call for zero rate increases between 2018 and 2019.

“It’s better to have a higher rate than we need for this coming year, and then no rate increase for next year, than to have two smaller rate increases that close together,” Tabone said.

BASIC CHARGE

To accomplish this, the basic charge for residential rates would increase from $14.50 to $18.50 by January 2018, and in April 2018, the residential energy rates would increase from $0.0860 to $0.0882 per kWh for Block 1, and from $0.1048 to $0.1070 per kWh for Block 2. Block 1 is for customers consuming 600 kWh per month or less, while Block 2 is for customers consuming more than 600 kWh per month.

For residential rates, this would be higher than Pacific PUD’s $18, but lower than Clallam PUD’s $28.33. PSE currently charges $7.87 a month and is proposing to charge $9, PUD officials said in a PowerPoint presentation.

For those consuming 600 kWh per month, the average monthly bill would go from $66.10 in 2017 to $70.10 in January and $71.42 in April. For those consuming 2,000 kWh per month, the average monthly bill would go from $212.82 in 2017 to $216.82 in January and $221.22 in April.

“The forecasts are based on the Bonneville Power Administration’s [BPA] assumptions of normal weather conditions,” Tabone said. “There are swings every year in the weather, which we have no control over, which is why we need some cushion, albeit not too much.”

For schools, the PUD is proposing no change to its basic rate of $300, with a minor increase in its demand rate from $5 to $5.50 in April 2018, the same month that would also see an increase of $0.0640 to $0.0702 per kWh for its energy rate. By comparison to the proposed annual residential rate increase of 5 percent, this would yield an annual school rate increase of 6.1 percent from 2017 to 2018.

“Last year, the schools saw a relatively low rate increase,” Tabone said. “This year, the PUD needs to catch up to its costs of providing service.”

Kevin Streett, assistant general manager of the PUD, noted the number of contributing expenses that the Jefferson County PUD has little to no control over, from BPA expenses and fixed interest rates on its loans to taxes, depreciation and administrative costs.

“There’s a very small piece of the pie that we have any effect over,” Streett said. “We’ve cut down as much construction as we can, and eliminated vehicles from our fleet. When we ask for this increase, it’s after we’ve already pared down where we could.”

DOES THIS HELP?

Kenneth Collins, PUD board president, listed a series of projections for how PUD customers’ bills would be affected if the PUD increased its base rate, versus if it increased the cost of consumption, and used the resulting statistics to argue that low-income customers would benefit from the PUD’s cost increases leaning more heavily on the base rate.

“If you increase the cost of consumption, it concentrates those costs in the months of highest consumption,” Collins said. “Otherwise, you can spread out the impact.”

Collins estimated that only one-quarter to one-third of the people who are eligible for low-income assistance from the PUD actually take advantage of it.

“We need to track the figures for this year,” Collins said. “We need to know, does this provide the help people need?”

Collins pointed out that it benefits both the PUD and its customers when its rates are more predictable.

Streett added that, while the PUD has a deadline of Nov. 21 to make a decision on next year’s budget, that doesn’t necessarily include making a decision on next year’s rates.

“We need to get out into the district, to discuss this with the people, before we make a decision,” Collins said.