At a recent Snohomish PUD rate hearing, the question was asked, “What was the cause of the rate increases?” The PUD responded: Customers’ rates are higher because the PUD must pay more for the power it purchases. The primary reason is higher priced power from the Bonneville Power Administration, which raised its rates by 46 percent in 2001. And, the PUD and other utilities were given no good choices for power purchases to meet customer demand during early 2001. They were forced to either buy power off the short-term market at exorbitant prices (up to 10 times historic levels) or off the long-term market (at 5 times historical levels.”
This answer is misleading and incorrect. The PUD rate increase over the recent two-year period has been about 60 percent of which only 18 percent is attributed to BPA. This rate increase will be for the next six years. Imagine if the PUD were a full BPA customer. PUD managers and commissioners caused the rate increase because of poor management decisions. The main reason for the rate increase was due to the PUD choosing to purchase 100 average megawatts of high cost power on the open market. Many lower cost alternatives were available other than the purchase of long-term high cost power. The PUD was not forced to enter into long-term contracts. A time of peak market energy prices was not the time to enter into long-term purchases. You don’t enter into a 30-year home mortgage when interest rates are 18 percent. The leaders didn’t even take into consideration that customers would use less power when their rates went up. The poor choices that the PUD made in raising the rates have impacted severely Snohomish County’s small businesses and the general economic welfare of the customers.
The people of Snohomish County should now make the choice to change the management (not just Paul Elias) and commissioners of the PUD, especially Don Berkey, who did not perform their duties to safeguard the public, and did not protect the people of Snohomish County from high prices. Qualified people should replace the employees who have been promoted into positions beyond their abilities for reasons unrelated to their performance. It isn’t necessary to hire consultants from outside the PUD at ridiculous prices when there are highly qualified and degreed financial planners and engineers employed at the PUD who have not been fully utilized by management. It is time to clean house at the PUD.
Bothell
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