LONG BEACH - If you noticed that your last electricity bill was a lot less than you expected it to be, thanks goes to lawyers and public utility districts.
Because of three favorable decisions in the Ninth Circuit Court in 2007, many Public Utility District No. 2 of Pacific County customers received a substantial refund in their December statements.
For example, one customer who owed $120 through a particularly cold month had only to pay $30 because of the $90 adjustment. Each ratepayer's bill reflected several factors in calculating the refund, but the bottom line was saving money for those who paid for electricity in 2007 in Pacific County and who were still on the roles in December.
In essence, our region's wholesale provider of electricity - Bonneville Power Administration - was giving a special price break to the customers of private electricity companies such as PacifiCorp, which sells power across the river in Clatsop County, Ore. A lawsuit forced BPA to reimburse these funds to publicly owned utilities like ours. This meant a lump sum payment of $1.4 million in Pacific County. Payments in future years will be used to offset any retail rate hikes that might otherwise be required.
PUD No. 2 of Pacific County, along with other utilities, had filed suit in the Ninth Circuit Court alleging that BPA was not allowed by law to enter into 2000 Residential Exchange Program Settlement Agreements. These allowed BPA to collect more from the public utilities and subsidize the private utilities. Public utilities won the court case and Bonneville was instructed to redo the relevant rates.
The return of past overcharges to public utilities in the Northwest is being accomplished in three ways: 1) lowering wholesale power rates one percent effective Oct. 1, 2008; 2) making a one-time payment in October 2008 for overcharges in fiscal year 2007-08; and 3) making additional payments through a monthly credit in utility bills beginning 2009 for seven years.
For the local district, this means a one percent reduction in wholesale power rates for the Oct. 1, 2008 through Sept. 30, 2009 period. A wire transfer was received Oct. 23, 2008, of $1,393,146.
PUD No. 2 Utility's Board of Commissioners decided to refund the $1,398,344 amount already received to those customers who paid for electricity during 2007 and were current customers on Dec. 1, 2008. The credit amount is a separate line item on customers' bills and was based on the percentage of the amount paid to the total revenue received by the PUD in 2007 for electricity multiplied by the overcharge received from BPA.
The amount received from Bonneville on a monthly basis over the next seven years will be collected and used as a buffer against future retail rate increases, the next one anticipated on Oct. 1, 2009. It is estimated that there will be a wholesale power rate increase of somewhere between 10 and 20 percent from Bonneville in fourth quarter of next year. These funds will be used to keep that increase down and subsequent credits to the wholesale power bill can provide a possible adjustment to our retail rates power cost adjustment figure in years 2010 through 2015.