Bill urges PUD to settle with BPA Utilities advised to settle with BPA

Published 9:00 pm Friday, December 5, 2003

With his finger pointed squarely at the Snohomish County PUD, a state representative from Anacortes on Friday filed a measure that urges public utilities across the region to accept an agreement that would lower the rates dozens of Northwest utilities pay the region’s largest provider of electricity.

Last month, the PUD became the first utility to refuse to settle a lawsuit it and 71 other public utilities are pursuing against the Bonneville Power Administration.

If the PUD doesn’t change its mind by a Jan. 21 deadline, there’s no chance the federal energy wholesaler will roll back its 2.2 percent October rate increase, a major blow to the Northwest’s already struggling economy, Democratic Rep. Jeff Morris said.

"Let’s face it, they’re the big dog on this," Morris said of the PUD. "In reality, what they do probably has the largest impact on settlement."

At least one other public utility has voted to reject settlement and also would have to change its mind if one were to occur.

Morris used the Legislature’s special one-day session to try to lean on the PUD and other utilities that are thinking about not signing the agreement to "do what’s best for the region and sign."

To make his point, Morris, along with six bipartisan co-sponsors, introduced House Joint Memorial 4029, a nonbinding measure that, if approved, would show the region’s public utilities how important it is to settle. Morris hopes to get a vote on the measure shortly after the Legislature’s new session starts Jan. 12.

"I wanted to send a clear message to the PUD that they are being watched very closely on what they’re doing to the region," Morris said.

He said the PUD has ignored his request to discuss the issue, and added that he didn’t appreciate how the PUD board snubbed Gov. Gary Locke by ignoring his request to meet with the board before it voted on the settlement proposal.

PUD Commissioner Dave Aldrich said there’s no way the board will change its mind, and said the Legislature should get behind the PUD’s lawsuit, which seeks to make sure public utilities get a fair share of BPA’s resources.

He said it’s BPA — which actually has large reserves and is making early bill payments to the U.S. Treasury — that has done nothing to lower rates.

"It doesn’t help at all to have our legislators passing some kind of joint memorial that will have no effect at all," Aldrich said. "I frankly think it will embarrass them, because it will show they have no real understanding of the issues."

Aldrich said the PUD is sticking with the lawsuit because the last time BPA set its rates, it did so in a way that was way too favorable to private utilities such as Puget Sound Energy.

He pointed to cash benefits sent to private utilities — which take money in lieu of electricity from BPA — that went from $50 million to $70 million a year from 1999 to 2001, to $380 million to $390 million a year from 2002 to 2006.

The latter amounts are linked to a new formula BPA used to distribute its benefits, a formula the public utilities’ lawsuit challenges.

BPA spokesman Ed Mosey said the settlement proposal is a compromise worked out between public and private utilities that cuts back the amount of benefit private utilities enjoy.

He added that BPA has cut expenses by $400 million and that the utility is making early payments to the Treasury so the cost of paying the government back for the region’s dams is not pushed on to future generations.

Reporter Lukas Velush: 425-339-3449 or lvelush@heraldnet.com.