EPUD Rate Updates
May 2011 Update:
Excerpted from EPUD May Community Meeting Presentation:
One of EPUD’s priorities is keeping rates as low as possible. EPUD’s original charter back in 1983 was to keep rates below Pacific Power’s by at least 5 percent. This year, EPUD rates are 22.4 percent lower than Pacific Power rates. When comparing EPUD rates to the rates of other local utilities, EPUD is in the middle of the pack. EPUD will never have the lowest rates around for multiple reasons, including territory size/density and utility age. EPUD has a large, rural territory with few customers per mile of wire, which is more expensive to maintain. EPUD is also young and is still working diligently to pay off its original debt issued to fund the purchase of the system from Pacific Power.
36 percent of EPUD expenditures are for Net Power, the power we purchase mainly from Bonneville Power Administration (BPA) to serve you. BPA will be passing an average of 8.3% rate increase on to its customers in October of this year. This will make it difficult for EPUD to avoid increasing rates, considering 36 percent of our total budget will be increasing by 8.3 percent.
46 percent of EPUD expenditures are for Operations & Maintenance and Construction & Capital Expenditures. These expenditures include transformers, poles, meters, labor to install these items, day-to-day expenses to run the utility, our tree trimming program, customer service and billing, and other general maintenance of the system. Costs across the board in this area are up drastically. In 2003, an overhead transformer was $500 and a 40ft pole was $230. In 2010, a transformer was $1,100 and a pole was $400. (Download the handout for more examples of rising costs.)
18 percent of EPUD expenditures are on debt service, which goes to principal and interest payments. We are young utility and still paying off our original debt. We have not borrowed additional money for five years, and will see some relief in 2012 from paying off a portion of our borrowings.
EPUD worked hard to avoid a rate increase in 2011. EPUD has delayed some capital expenditures but the combination of delaying important capital expenditures and not raising rates is not sustainable. There is upward pressure: rising costs for materials and supplies, and the BPA rate increase. Because of these and other factors, EPUD customers should expect a rate increase in 2012.
January 2011 Update:
Looking Ahead – EPUD Approves 2011 Budget With No Rate Increase & Prepares for 2012
2011 Budget The EPUD Board of Directors approved the 2011 operating budget in December, which outlines EPUD's continued efforts to keep pace with rising costs with minimal impact to our Customer-Owners.EPUD does not expect to borrow money OR raise rates in 2011 and will instead use 1.7 million in cash reserves to fund needed infrastructure projects. Based on our current cash position, the usage of cash reserves did not concern the budget committee and was considered favorable in lieu of borrowing. CLICK HERE to see the final budget and the recommendation of the citizens advisory committee on finance.
In 2011, $1,754,182 will be used for major capital improvements, including the replacement of a Pleasant Hill transformer costing approximately $700,000. EPUD has delayed projects in recent years in an effort to keep rates low, but these improvements can no longer be delayed. Decreases to the budget included $727,851 for electric materials, service agreements, generation and system projects, fixed asset acquisitions, non-operating expenses, and interest expenses.
2011 and Beyond Power costs will continue to be a driving factor in EPUD’s future rates, and EPUD does expect to raise rates in 2012. Bonneville Power Administration (BPA) will raise their power rates an average 8.3 percent, effective October 2011, with the possibility of additional increases depending on water levels and other factors. Approximately 36 percent of EPUD’s total budget is dedicated to power purchases from BPA, so these increases will have a heavy impact.
EPUD will also begin a new contract with BPA in October 2011, limiting the amount of “cheap” hydropower we can access from BPA. To meet future growing demand, EPUD will need to acquire power from alternative sources, which could increase our power costs
EPUD will continue to communicate any changes moving forward. Please do not hesitate to CONTACT US with any questions or concerns.
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June 2010 Update:
The EPUD Board of Directors approved an average 4% rate increase at the board meeting on May 11. The decision came after review of proposals by the Citizens Advisory Committee, and after a public hearing to consider any public comment or concern. The increase will be effective July 1, 2010 and will cost the average residential Customer-Owner an additional $4 per month. Basic monthly charges will remain the same.
Why are rates increasing? Multiple factors are behind the rate increase but the bottom line is that as the regional demand for power rises, the COST of power also rises. Here are a few of the factors at play:
- As the population of our region grows, so does the cost of providing power. New generation facilities needed to produce additional power, cost 130% more to build today than they did in 2000.
- The regional demand for energy will continue to increase as much as 30% by 2030, with a higher percentage forecasted for Lane County.
- Bonneville Power Administration can no longer provide all the power needed to supply our region. Because of this, individual utility companies like EPUD must find ways to meet the growing power needs of our District. This means investing in renewable energy and purchasing power from the market. Both of these options are more expensive.
- Reliable service requires maintenance and upgrades, which cost more and more as prices rise. The cost of power will also continue to rise, so while we strive constantly to tighten our belts and find the most cost-effective ways to operate, rate increases are still necessary to offset what we can’t compensate for internally.
The bottom line… EPUD must raise rates to cope with these issues and remain a solvent company. We take this rate increase very seriously, and understand the potential impact it many have on our Customer-Owners. As a nonprofit public power entity, EPUD provides power to you AT COST. We raise rates only when necessary to cover the cost of providing power.
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May 2010 Update:
EPUD Board Approves Rate Increase
The Emerald People’s Utility District Board of Directors approved an average four percent rate increase during the Board meeting on May 11. After review of proposals by staff, the Citizen Advisory Committee, and the public, the Board adopted the increase effective July 1, 2010. This increase will cost the average EPUD residential Customer-Owner an additional $4 per month.
“EPUD’s highest priority is to provide reliable, cost-effective service to our Customer-Owners,” said EPUD General Manager Frank Lambe. “The challenge remains that reliable service requires maintenance and upgrades, which cost more and more money as prices rise. The cost of power will also continue to rise, so while we strive constantly to tighten our belts and find the most cost-effective ways to operate, rate increases are still necessary to offset what we can’t compensate for internally.”
As a not-for-profit public power entity, EPUD provides power to its Customer-Owners at-cost, and raises rates only when necessary to cover the cost of providing power to its District.
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April 2010 Update:
EPUD Holds Public Hearing to Discuss Rate Increase
EPUD will hold a public hearing on Tuesday, April 13, to gather public comment regarding the utility’s proposed four percent rate increase. If approved, the increase would be effective for all bills issued on and after July 1 for all rate classes, except irrigation which would become effective January 1, 2011.
The EPUD Board of Directors and the Citizens Advisory Committee are proposing a rate increase to offset the rising cost of maintaining EPUD’s distribution facilities and the rising cost of power. As a not-for-profit public power entity, EPUD provides power to its Customer-Owners at-cost, and raises rates only when necessary to cover the cost of providing power to its District.
WHO: EPUD Board of Directors: Bruce Pilling, President; Patti Chappel, Vice-President; Katherine Schacht, Secretary; Bill Tanner; Penny Jordan. EPUD General Manager Frank Lambe. Interested EPUD Customer-Owners.
WHAT: Public hearing to gather public comment on proposed rate increase.
WHERE: EPUD Boardroom - 33733 Seavey Loop Road -Eugene OR, 97405
WHEN: Tuesday, April 13, at 6 p.m.
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January 2010 Update:
EPUD Board Approves 2010 Budget
The EPUD Board of Directors recently approved the 2010 budget, which outlines EPUD's continued efforts to keep pace with rising costs at minimal impact to its Customer-Owners. Even with the use of $444,000 in cash reserves and nearly $650,000 in cuts to capital expenditures, labor, materials, and energy services, the 2010 budget still requires a rate increase to offset rising costs. Exact details of the rate increase will be released after the EPUD Citizens Advisory Committee on Rates convenes in the spring.
The proposed budget was reviewed by the EPUD Citizen Advisory Committee on Finance before being passed to the Board for a public hearing and then approval. “Recommendation for this budget included deferral of major capital expenditures into future years,” said Committee Chairman Robert Ball. “The only increases for 2010 are based on projected price increases and critical system improvements and maintenance.”
As a not-for-profit public power entity, EPUD provides power to its Customer-Owners at cost, and raises rates only when necessary to cover the cost of providing power to its District.