Pacific Power files for power cost true-up tied to volatile 2021 energy prices
PORTLAND, Ore.— Pacific Power has filed its annual Power Cost Adjustment Mechanism (PCAM) with the Washington Utilities and Transportation Commission. The PCAM trues-up the actual costs of power from 2021 to the estimated costs that were put into rates at the beginning of 2021. The request varies by customer type, but in total averages to a 4.0 percent, or $15.9 million, increase in costs to customers.
“We know that 2021 was a difficult, volatile year for energy prices in the West,” said Matthew McVee, vice president of regulatory policy and operations. “The past year saw a record heat dome in the Northwest and unseasonable cold snaps. Our 10-state footprint and diverse sources of power generation allowed us to weather these extremes. However, the spike in the cost of electricity we needed to buy on the market to serve customer needs, the drop in hydropower generation caused by the long-term drought, and prices for natural gas, which is used in some of our generating plants, still exceeded projections.”
Pacific Power was able to offset some of these costs and impacts to customers due to its participation in the Western Energy Imbalance Market (EIM). The EIM enables access to even more low-cost, zero-carbon energy across the entire Western U.S. market while reducing emissions and increasing reliability.
In 2021, Pacific Power provided its Washington customers with $9.3 million in savings through its participation in the EIM. Those incremental savings are passed through to customers in the PCAM, but even these impressive savings were insufficient to completely offset the increases caused by market prices.
To lessen the impact of this cost increase on customers, Pacific Power is seeking to spread the impact of the 2021 energy price increases over the next two years. The PCAM rate request will be reviewed by the Commission. As part of this request, Pacific Power is proposing that the PCAM rate adjustments take effect on Jan. 1, 2023.
Additional June rate filings
- Also on June 15, Pacific Power filed a 1.0 percent decoupling mechanism price increase. The purpose of this mechanism is to decouple energy sales from revenue, which supports the Company’s recovery of its fixed costs while it pursues conservation and energy efficiency. The Company has proposed an effective date of Sept. 1, 2022.
- On June 1, Pacific Power filed a request for a 2.1 percent overall increase to customer bills to support the System Benefits Charge. The purpose of the System Benefits Charge is to collect funds for the company’s energy efficiency programs. Pacific Power has a broad range of programs available to individuals and companies for making more efficient choices and the proposed increase will help increase participation in these programs in alignment with Energy Independence Act targets and Clean Energy Transformation Act objectives. The company has proposed an effective date of Aug. 1, 2022.
Helping customers manage higher energy costs
If you need assistance managing your energy costs, contact us toll free at 888-221-7070 and we can set up an equal pay plan or put you in touch with local resources to help you:
- The federally funded Low Income Home Energy Assistance Program (LIHEAP) helps low income households with energy costs. It is administrated by the Washington Department of Commerce through local agencies.
- Tenants and landlords: Resources are available from the federal Emergency Rental Assistance Program to help renters unable to pay utilities and rent due to circumstances related to COVID-19. Funds are available for a limited time.
- Project HELP is a nonprofit program providing energy assistance with donated funds.
- Pacific Power's Low Income Bill Assistance program provides a bill discount to income-eligible households year-round. The program is administered through the LIHEAP agencies.
- Local agencies provide free weatherization services to income-qualifying homeowners and renters living in single-family homes, mobile homes or apartments.