Regional plan could hike rates, PUD warns

Herald staff and News Services

PORTLAND, Ore.— Snohomish County PUD and a coalition of other Pacific Northwest utilities on Monday stepped up opposition to federal plans for a regional agency to oversee electricity transmission across the West, claiming it will boost rates and open the grid to Enron-style market abuse.

PUD Commissioner Don Berkey said estimates of an immediate 4 percent rate hike if the agency is formed are "conservative and accurate only if everything goes right. In the worst case, we could have lights out."

Berkey and other coalition leaders say a Western "regional transmission organization," or RTO, will add a layer of costly federal bureaucracy that will strip control of the power grid from local governments and utilities that are directly accountable to voters or their customers.

The coalition claims the regional agency could cost electricity customers hundreds of millions of dollars — more than $80 million to create and up to $150 million to operate each year, while creating more than $200 million in new taxes.

The coalition, called Northwest Power Works, includes 23 public utility districts in Washington state, Seattle City Light, Tacoma Power and the Springfield Utility Board in Oregon. Last week they filed a formal protest against the RTO plan with the Federal Energy Regulatory Commission (FERC).

Steve Loveland, Springfield Utility Board manager, said the regional plan would create the same kinds of problems in the Pacific Northwest that caused rolling blackouts and skyrocketing electricity rates during the California energy crisis.

Al Aldrich, the PUD’s chief lobbyist, said the RTO plan might be a solution for some parts of the country where transmission is less reliable, but not in the Northwest, which has a steady source of hydroelectricity from dams managed by the Bonneville Power Administration. BPA also operates much of the transmission system in the West.

Berkey and other coalition leaders made their comments during a break in a Western regional transmission organization planning meeting attended by FERC Chairman Pat Wood, who said he wants to prevent price manipulation or the kinds of energy deregulation problems that led California Gov. Gray Davis to declare a statewide emergency in January 2001.

"One of the lessons is, let’s make sure this never happens again and make sure the West doesn’t suffer," Wood told about 300 utility managers and energy planners at the meeting.

But he also warned regional cooperation on energy planning is needed to sustain economic growth and prevent bottlenecks in the transmission system.

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