Power price surge prompts PUD to re-examine needs

  • KATHY DAY / Herald Writer
  • Tuesday, December 5, 2000 9:00pm
  • Local News

By KATHY DAY

Herald Writer

EVERETT — While Californians were being urged Tuesday to delay turning on their holiday lights to conserve energy, Snohomish County PUD commissioners were discussing the dramatic increase in electricity costs.

Their discussion was prompted by a report that the cost of buying 1 megawatt of power — enough to supply about 20 homes — on what is known as the "hour ahead market" jumped to $1,200 Tuesday morning. Commissioner Don Berkey, who raised the issue, said that a year ago the price was about $30 an hour. The price is the most costly way of buying power and is used when a utility’s need for power exceeds its supply on hand.

"Do we really want to rely on the open market?" Berkey asked the board. "I do not. Sooner or later, and probably sooner, this will catch us."

General manager Paul Elias added that if the utility has to buy 10 percent of its power on the open market "at prices like this it could double our power costs."

The cost of power this year is higher because demand is increasing while supplies have been limited by a lack of power and timing of rainfall that supplies the hydroelectric systems on which many Western utilities rely for supply. In addition, several key plants that generate power are out of service for repairs.

Combined with cold weather in the Northwest, the shortages prompted California officials to issue on Tuesday an alert urging businesses and residential customers to cut power between 4 and 7 p.m. when businesses are still open and customers are arriving home from work. They also urged residents to hold off on turning on holiday lights until after 7 p.m.

That state’s problems are acting as a signal to PUD commissioners and utilities around Washington state that they need to brace for rising power costs.

Even as commissioners Tuesday approved the proposed 2001 budget of $468 million, the staff was starting to look at changes in PUD financial plans, said John White, assistant general manager. Those changes will affect recommendations for rate changes, which are likely to come before the board in February.

He noted that the PUD largely has been able to avoid buying power on the open market and that not many utilities were buying at the $1,200 price.

In the last few days, White said, predictions of cold weather for December and January, an anticipation by the Bonneville Power Administration indicating that we’ll have a dry winter based on rainfall to date, and California generators being off-line have all come together to drive up prices.

To buy now for 2001 — when the district will be operating under a higher-priced BPA contract — would cost about $225 a megawatt hour, up from $10, he added.

BPA is seeking approval for rate increases and has already warned it will need a 15 percent surcharge on top of that to cover its increased costs. When power from the facilities along the Snake and Columbia rivers fall below what BPA customers need, the agency purchases power on the open market.

The increase in market prices will play into the PUD’s decision on how to structure its final contract. To go the route planned —called block/slice — would leave the district open to more variation in prices. To shift to a program called partial/complex would mean slightly higher but more predictable prices.

"These prices are causing us to take another look," White said.

Talk to us

> Give us your news tips.

> Send us a letter to the editor.

> More Herald contact information.

More in Local News

A big decision for Boeing’s next CEO: Is it time for a new plane?

As Boeing faces increased competition from Airbus, the company is expected to appoint a new CEO by the end of the year.

A Mukilteo Speedway sign hangs at an intersection along the road in Mukilteo. (Ryan Berry / The Herald)
Mukilteo Speedway name change is off to a bumpy start

The city’s initial crack at renaming the main drag got over 1,500 responses. Most want to keep the name.

Two workers walk past a train following a press event at the Lynnwood City Center Link Station on Friday, June 7, 2024, in Lynnwood, Washington. (Ryan Berry / The Herald)
Trains up and running on Lynnwood Link — but no passengers quite yet

Officials held an event at the Lynnwood station announcing the start of “pre-revenue” service. Passengers still have to wait till August.

Nedra Vranish, left, and Karen Thordarson, right browse colorful glass flowers at Fuse4U during Sorticulture on Friday, June 7, 2024, in Everett, Washington. (Olivia Vanni / The Herald)
A promenade through Everett’s popular Sorticulture garden festival

Check out a gallery of the festival’s first day.

Left to right, Everett Pride board members Ashley Turner, Bryce Laake, and Kevin Daniels pose for a photo at South Fork Bakery in Everett, Washington on Sunday, May 26, 2024. (Annie Barker / The Herald)
Second Everett Pride aims for even bigger rainbow of festivities

Organizers estimated about 3,000 people attended the first block party in Everett. This year, they’re aiming for 10,000.

Everett
Fake gun sends Cascade High School into lockdown

Police detained a suspect with a fake weapon around 12:30 p.m. The lockout was lifted before 1:30 p.m.

Rose Freeman (center) and Anastasia Allison of The Musical Mountaineers play atop Sauk Mountain near Concrete in October 2017. (Ian Terry / The Herald)
Musical Mountaineers’ sunset serenade to launch Adopt a Stream campaign

The nonprofit aims to transform into an “accessible model of sustainability,” with solar panels, electric vehicles and more.

The I-5, Highway 529 and the BNSF railroad bridges cross over Union Slough as the main roadways for north and southbound traffic between Everett and Marysville. (Olivia Vanni / The Herald)
Highway 529 squeeze starts now between Everett, Marysville

Following a full closure for a night, starting late Sunday, Highway 529 will slim down to two lanes for months near the Snohomish River Bridge.

A Marysville firefighter sprays water on a smoking rail car at the intersection of 116th Street NE and State Avenue around 8 a.m. Thursday, June 13, 2024, in Marysville, Washington. (Mike Henneke / The Herald)
Rail car catches fire, blocks traffic in Marysville

Around 7:20 a.m. Thursday, firefighters responded to reports of smoke coming from a rail car near 172th Street NE, officials said.

Firefighters transported two people to hospitals while extinguishing an apartment fire near Lake Ballinger in Edmonds Wednesday.
2 injured in Edmonds apartment fire

At least nine people were displaced by the fire on 236th Street SW, officials said. Nearly 50 firefighters responded.

U.S. Fish and Wildlife staff place a radio collar on a Grizzly Bear in the Cabinet-Yaak ecosystem. (U.S. Fish and Wildlife / Wayne Kasworm)
For grizzly bears coming to Cascades, radio collars will keep close tabs

Tracking an apex predator is tricky. GPS collars play a central role in a controversial plan to repopulate grizzlies in Washington’s wilderness.

Maplewood Parent Cooperative School seventh and eighth grade students listen to Mason Rolph of Olympia Community Solar speak about different solar projects during a science class for the student's Sustainable Schools engineering units on Friday, June 7, 2024 in Edmonds, Washington. (Olivia Vanni / The Herald)
How can Edmonds make new schools more sustainable? Students have ideas

In a town hall Friday, students from Maplewood Parent Co-op will make pitches for the soon-to-be rebuilt College Place schools.

Support local journalism

If you value local news, make a gift now to support the trusted journalism you get in The Daily Herald. Donations processed in this system are not tax deductible.