The Lewis County Public Utility District has proposed a 3.8 percent rate increase in order to make up for lost revenues and balance the 2020-21 budget. The per-day basic charge of 95 cents is planned to remain the same.
If the rate increases are approved by the PUD commissioners after the second reading at 10 a.m. on Oct. 6, then the changes will go into effect on Jan. 1, 2021.
There would also be a 3.8 percent increase to the demand charge, which is a charge that gets added to accounts who use over 50-kilowatt hours of electricity. The increased demand charge will only affect large commercial and industrial use customers, according to the PUD Public Affairs Manager Willie Painter.
The PUD raised rates by 4.75 percent in 2020.
The PUD also held its second budget hearing just before the rate hearing and the commissioners approved the 2021-22 budget with no amendments. The budget presentation identified a $4 million deficit.
The 3-year operating plan presented by staff shows a budget deficit in each of the three years — a $4 million deficit in 2021, $5.9 million in 2022 and $9 million in 2023.
The PUD identified the factors driving the rate increase as capital projects investment, contract tree trimming, added system activity, customer growth, large customer loss and lower retail sales.
The COVID-19 pandemic has led to decreased revenue and the PUD is planning a $21 million debt issuance for substation rehabilitation and advanced metering infrastructure to be repaid over the life of the equipment. The substation infrastructure is aging and is, on average, about 54 years old when 30-40 years old is the industry standard.
“We have a few major factors driving retail sales assumptions. One, first and foremost, is COVID-19, there’s a lot of uncertainty about this. Unfortunately, seeing the number of business closures locally, it is having a damping effect on retail sales estimates into the future,” said Roden during the first budget hearing.
The PUD also addressed the LED lighting rate changes. Since the LED lights have lower power and maintenance costs the rate for lighting will decrease by about 30 percent.
Other actions the PUD is taking include completing a comprehensive rate study in 2021 to help inform future rate design and cost recovery. The PUD also plans to establish a Customer Review Board in 2020 that will participate in the Cost of Service Analysis (COSA) and “provide sector-specific insights.”
The rates and other changes will not go into effect until the board of commissioners votes on the proposed changes after the second rate hearing at 10 a.m. on Oct. 6.
The public attended Tuesday’s budget and rate hearing via Zoom or phone and from the PUD’s Chehalis and Morton offices.
The PUD is also making a transition from bi-monthly to monthly billing in phases — some customers will start receiving monthly billing next month and all PUD customers will be transferred over to monthly billing by the end of the year.
More information on the rate hearing and the recently approved 2020-21 budget can be found on the PUD’s website — www.lcpud.org. Written comments from the public, to be read at the next rate hearing, can be submitted via email to execadmin@lcpud.org or by mail to PO Box 330, Chehalis, WA 98532.
