Rates set to jump for Pacific Power, PGE customers in January.
Published: Friday, December 17, 2010, 9:24 PM Updated: Friday, December 17, 2010, 9:24 PM
Come New Year’s, better strip the lights off the house and the Christmas tree ASAP.
Customers of Pacific Power will see their electric rates spike 14.5 percent in January. The increase comes in a one-two punch: an 8.4 percent general rate increase state utility regulators approved Friday, and a 6.1 percent increase for increased power costs they are expected to approve Dec. 28. Both take effect Jan. 1.
Meanwhile, customers of the state’s largest electric utility, Portland General Electric Co., will see a lesser, but still significant, rate increase of about 3.9 percent. A few mandatory cost adjustments in the works will bump that overall increase to 4.2 percent, effective Jan. 1.
The biggest factor driving the increases: renewable power.
Oregon’s public policy choices during the past few years are coming home to roost in rates, a trend that will continue and likely be exacerbated in coming years by environmental edicts dealing with global warming and haze reduction.
For the time being, state mandates requiring utilities to meet 25 percent of customer demand with renewable power by 2025 — with interim targets before then — are jump-starting utility investments in wind farms, hydroelectric projects and the transmission lines to access remote, windy areas. Those projects have a long life span and low fuel costs. But the upfront capital costs are steep, and the resource is intermittent.
The largest part of Pacific Power’s general rate case was driven by a new transmission line and the two new Wyoming wind farms it connects to the utility’s customers. The company also installed pollution controls at a coal plant in Wyoming and needs to replace cheap electricity it has been buying under long-term contracts that are expiring.
“It’s a big increase,” said Pat Egan, a spokesman for Pacific Power. “We know this is not a great time for this.”
But in the end, he said, the utility has little choice. It has been told to invest in renewables.
Full story here
h/t to WUWT reader Steve in Oregon
It’s easy to see why Pacific Power put wind farms in Wyoming and then built transmission lines to it:
The downside is that wind isn’t 24/7/365, and you still need nuclear, hydro, and coal to back up wind power when the wind doesn’t blow.
I wonder how Portland General will meet their mission if they get too much reliance on wind, and not enough backup? The “reasonable price” directive seems to be out the window already:
According to their current figures filed with the SEC, hydro and wind combined makes up 29%. That sure is a lot of power uncertainty to connect to the vagaries of wind and weather.