by MATTHEW NASH
Sequim Gazette

Electricity rates are going up 8 percent beginning Dec. 1.

Clallam County Public Utility District commissioners approved the increase Oct. 25.

Doug Nass, PUD general manager, said the increase is permanent and based on recent increases from the Bonneville Power Administration.

Bonneville increased wholesale rates by about 5 percent in October 2009 and another 5 percent on Oct. 1.

Commissioners voted to absorb the first increase but decided against doing it a second time.

Ted Simpson, PUD commissioner, said commissioners strive to avoid or minimize rate increases where possible.

"We were able to defer any rate increase in 2009, despite a BPA rate increase, but it would not be fiscally prudent to do so again," Simpson said.

Nass said commissioners felt strongly about absorbing the rates the first time but didn't see it as viable with revenue down due to low usage during good weather and rising cost for materials, operations, maintenance and technology.

Nass also attributes the increase to upcoming mandates from voter Initiative 937 that require 15 percent of energy revenue to be spent on renewable sources by 2020.

The initiative progressively increases the PUD's investment each year.

"We know renewables are going to be ramping up in the coming years along with conservation efforts that will both affect our rates in the next two years," Nass said.

The rate increase will cost the average customer using 1,400 kilowatt-hours a month about $8 per month.

"I think the commissioners and myself look very hard at any increases because of the way the economy is and how every dollar counts to our customers," Nass said.

"We start with a budget and scale it way back. One of our strategic goals is to have stable rates. A number of PUDs are doing the same thing we've had to do."

Renewable options

The PUD began plotting renewable investments several years ago.

It has spent about $300,000 over three years on Radar Ridge, an 80-megawatt wind project east of Long Beach in Pacific County.

Clallam PUD, Grays Harbor PUD, Mason County PUD and Pacific County PUD jointly spent about $3 million on the project.

Nass said they've encountered problems that could stop the project, such as the possible damage it could cause to the marbled murrelet bird.

"We might not continue to participate," Nass said. "We have shares of 15 percent and intend to get that back."

Radar Ridge could have helped the PUD meet its renewable energy threshold but staff has other options.

Pending PUD investments in renewable energy are as follows:

2012

3 percent in a dairy biogas project

2015

9 percent in biomass, solar and geothermal

2020

15 percent in biomass, solar, geothermal and a cost cap

Dairy biogas processes manure and harvests the methane gas.

Biomass could be available through the Port Angeles Nippon Paper Mill, where it burns flash waste from the pulp and paper waste.

Solar energy would come from Eastern Oregon where greater tax incentives exist.

Geothermal taps a certain location for hot water to process or hot rock to pump water down and produce steam.

"These future mandates are not cheap," Nass said.

PUD staff agrees Bonne-ville's energy is the cheapest and most readily available for Clallam customers.

"We're doing all we can to give reliable power in a financially responsible manner," Nass said. "We are very financially responsible and careful what we spend our funds on."

For more information on Clallam County PUD, visit www.clallampud.net or call 452-9771.

Reach Matthew Nash at mnash@sequimgazette.com.