OTEC rates to rise this fall

Posted on July 31st in News


Consumers can expect to see a 9 percent increase

Oregon Trail Electric Co-op (OTEC) members can expect to see a rate increase on their monthly electric bills this fall.  This expected increase is due to a 9 percent average wholesale power rate increase along with an 11 percent transmission rate increase announced July 24 by the Bonneville Power Administration (BPA). BPA is a nonprofit federal agency that sells OTEC its carbon-free hydropower from federal Columbia River dams, operates three-quarters of high-voltage transmission lines in the Northwest, and funds one of the largest wildlife protection and restoration programs in the world.  As a nonprofit federal wholesale utility that receives no Congressional appropriations, BPA must recover its costs through its rates.

The new rates take effect Oct. 1.

According to BPA officials, the wholesale rate increase is needed in order to compensate for reduced revenue forecasts from surplus power sales, and to continue funding needed for investments in the Federal Columbia River Power System. BPA officials say the transmission rate increase is mainly due to continued efforts to maintain system reliability and meet increasing demands for transmission in the Pacific Northwest.

The customers affected by this increase include public utility districts, tribal utilities, cooperatives, municipalities and federal entities. OTEC, as a cooperative and customer of BPA, has been expecting this increase and will analyze the overall impact it will have on business operations.

The rate increases are lower than previous estimates by BPA, which sometimes were as much as 21 percent. According to a recent BPA announcement, the agency was able to offset a portion of these increases; BPA has been able to take advantage of unique opportunities that decrease capital-related costs for the upcoming rate period.

OTEC Chief Executive Officer Werner Buehler said, “No one likes to hear that their monthly bills are going to increase, especially in this economy.  But when OTEC experiences a major increase in power costs, as a non-profit organization, we have to pass those costs along to our members.”

Over the next month, OTEC’s board of directors will determine how much the rate increase to members will be. The final number will be announced to the co-op’s members no later than September through local media and the cooperative’s communications channels.

OTEC members will be informed of the exact amount of the rate increase through Ruralite magazine, via OTEC’s website at www.otecc.com and through OTEC’s Facebook page at www.facebook.com/OTECoop.


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