The state of Oregon is reminding Pacific Power customers that their electric bills are going up substantially starting on the first day of 2023.
The Oregon Public Utility Commission said last week that it recently finalized rate increases for Pacific Power that took effect Jan. 1.
The overall average rate increase will be 14.8%. PUC says a “typical customer using 900 kilowatt hours per month” can expect to see their monthly bill jump from $91.89 to $111.34 — an increase of about 15.1%. Of course, the amount of the increase depends on how much energy the customer uses and whether they are residential, commercial or industrial.
PUC says the increase is due to two decisions. One is the annual adjustment for power costs, which can vary, and a general rate increase for non-energy related costs such as the cost of mitigating the risk of wildfires.
PUC said Pacific Power cited global supply chain problems as one factor a reduction of the supply and the increasing costs of electricity.
“We recognize that increasing rates at a time when Oregonians are already dealing with high inflation presents challenges for many customers,” PUC Chair Megan Decker said in a statement. “Unfortunately, fuel cost increases and supply chain delays caused by global events, combined with increasing volatility in regional electricity markets, drive the price for utilities to produce and purchase electricity. Although the utilities cannot avoid all of the impacts of these higher prices in the short term, there may be options available for residential customers to help reduce the bottom line impact.”
PUC reminds customers that Pacific Power recently launched a program that provides discounts of 20-40% to low-income customers.
“Pacific Power’s most vulnerable customers can also access a variety of bill support programs through local community action agencies, including the Oregon Energy Fund, Oregon Energy Assistance Program, COVID Energy Assistance Program and Low-Income Home Energy Assistance Program,” PUC said.
Here are more details from PUC about the two decisions that affected this rate change:
Transition Adjustment Mechanism (TAM)
Pacific Power files an annual transition adjustment mechanism (TAM) to update customer rates to reflect the company’s actual costs to produce and purchase electricity. Due to volatility in the energy markets and increased costs to produce and purchase energy, customer rates will increase by a larger amount than earlier estimated starting January 1, 2023. In October 2022, the PUC adopted a settlement between Pacific Power, customer advocate groups, and the PUC Staff for a power cost increase of approximately $66.43 million after taking advantage of tax credits that provide shared benefits with Oregon customers. That expected increase was based on Pacific Power’s preliminary power costs estimates. Pacific Power’s final November 15, 2022 power cost forecast, however, showed a 20.3 percent increase in power cost rates over the preliminary forecast.
General Rate Revision
The PUC recently approved a $46.7 million, or 3.7 percent increase for non-energy costs in a general rate proceeding, a reduction from the original requested increase of $84.4 million. This increase, which will also go into effect January 1, is driven by numerous factors, including increases in wildfire mitigation and vegetation management spending, capital additions, and miscellaneous increases to the company’s revenue requirement. The PUC also approved an agreement by the parties preventing Pacific Power from filing a general rate case in Oregon with rates effective earlier than January 1, 2025.
PacifiCorp serves approximately 630,000 customers in Oregon, and approximately 2.0 million total retail customers in California, Idaho, Oregon, Utah, Washington, and Wyoming.