OTEC rate hike: 7.1 percent

Oregon Trail Electric customers will notice an increase in their electric bills beginning Oct. 1. 

OTEC’s Board of Directors this week approved a 7.11 percent rate hike.

The increase comes after the Bonneville Power Administration’s (BPA) announcement that it would raise wholesale power costs to its utility customers — including OTEC, which buys almost all of its power from that federal agency.

“BPA’s big cost hike means that, unfortunately, our co-op is facing a major increase in the cost of the electricity that we purchase for our members,” said Werner Buehler, CEO of OTEC.

The average residential electric bill will rise by about $7.13 per month, OTEC estimates.

That estimate factors in both the rate increase and a boost in the monthly delivery charge, which will rise for all residential customers, regardless of the amount of power they use, from $15 to $18 starting Oct. 1.

“This is to make sure the increase is spread out more equitably” among customers, said Angela Perez, an OTEC spokesperson.

The delivery charge helps to cover OTEC’s costs for operating and maintaining thousands of power poles, hundreds of miles of line, as well as substations and other equipment.

OTEC last raised the delivery charged on Oct. 1, 2009, when it rose from $10 per month to $15 as a result of BPA’s 7.6 percent wholesale rate hike.

The power bill from BPA makes up about half of OTEC’s operating costs. OTEC says the overall increase also includes a rate rise of roughly one percent for delivery system upgrades described as “long overdue,” however.

Eastern Oregon is an area where demand from power users is strong year-round because of its cold winters and warm summers, which makes it a customer base with a “high load” of demand, Perez said.

This is why customers “need to have more power delivered” than in areas with gentler weather conditions during at least part of the year, Perez said.

A well-working delivery system also is important so the power transfers can reach users, she said.

Although BPA announced an average increase of 7.8 percent to its customers, OTEC will pay the BPA 11.43 percent more money for the electricity it delivers to users, Buehler said.

The upcoming rate hike is OTEC’s largest since Oct. 1, 2001, when rates rose by 30 percent.

Since then the biggest change was actually a decrease of 16 percent starting Jan. 1, 2006.

OTEC serves 22,500 customers in Baker, Harney, Grant and Union counties. More information is available at www.otecc.com.