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Benton PUD Announces 5% Rate Hike

August 25, 2016 By Cheryl Kaften

In Washington State, the three-member board of commissioners of the Benton Power Utility District (PUD) voted on August 23 to increase rates by 4.9 percent starting September 1 for its 51,000 residential , commercial, and industrial customers in Kennewick, Prosser, Finley, Benton City and surrounding areas in Benton County.

The electric bill for the average residential household served by the Benton PUD will increase $5.50 per month – or $113 annually. The increase for residential customers will include an increase in the base charge of 3 cents per day to 55 cents — or about 90 cents a month.

The PUD says electric costs for its customers will still be lower than the median monthly bill for comparable Northwestern utilities of $121.

The primary reason for the increase, according to the PUD, is net power costs. The utility said that its net power costs – which represent over 60 percent of Benton PUD’s total costs – have increased $14.7 million since 2012, or nearly 23 percent.

Power costs include long term contracts to purchase power primarily from the Bonneville Power Administration (BPA), a nonprofit federal power marketing administration based in the Pacific Northwest.  BPA wholesale rates have increased 26 percent in the last five years due to the need to upgrade aging infrastructure at the hydroelectric dams, the construction of transmission for the integration of renewable resources, and increases for fish and wildlife programs.

In addition, the PUD claimed, another key factor adding to rising power costs is reduced revenues from surplus power for resale. It generally has more power than is needed to meet customer demand; and therefore, sells any surplus into the wholesale market. But wholesale market prices have sharply declined since 2008.

The rate increase follows a 3.9 percent increase a year ago. Before that, Benton PUD had not changed its rates for nearly four years.

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