Clallam County Public Utility District commissioners have approved 2021 operating budgets that include utility rate increases taking effect in the spring.
Residential electric rates will go up 3.5 percent effective April 1, district officials said on Dec. 14.
Water rates will increase an average of 4.2 percent and wastewater rates will climb 5.9 percent beginning Feb. 1, according to the budget resolution.
Commissioners Will Purser and Jim Waddell voted last week to approve the 2021 electric, water and wastewater operating fund budgets. The rate increases were approved in 2019.
Commissioner Rick Paschall, who was elected in Nov. 3, abstained from voting on the budgets.
“Unless there’s a tie, I plan on abstaining from this vote since I haven’t been part of putting the budget together,” Paschall said in a virtual meeting.
Beginning in April, an average residential customer using 1,250 kilowatt hours of electricity per month will see the monthly electric bill go from $130.09 to $134.68, a net increase of $4.59.
“The majority of our (electric) rate increase is on the basic customer charge,” Sean Worthington, district finance manager/treasurer, told commissioners.
Waddell said a high base charge does not encourage home owners to install solar technology.
“We really need to think strategically about this and ask ourselves are we making the right trade-off here,” Waddell said.
“Should we be adjusting our base charge and rates to encourage and incentivize more customers to pick up on solar and battery combination in order to reduce our infrastructure charges and demand charges?”
The multi-year rate increases were based on a 2018 cost of service study that found the PUD’s base electric rates had been disproportionately low, Worthington said.
“We’re at a little bit of a disadvantage in our utility because we have such a large service territory and a challenging topography and a lot of miles of line, and that’s what really makes up that minimum system size that goes into that basic customer charge,” Worthington said.
“If we were in a more condensed area — even the city of Port Angeles, where I think they have 15 square miles of service territory — it might be a little bit easier to control, but just due to the nature of the storms and how large our service territory, is it is challenging.”
The PUD provides electricity to more than 31,000 homes and businesses in Sequim, Forks and all of unincorporated Clallam County.
The district’s 2021 electric utility budget contains $68.97 million in revenue and $71.13 in expenses. A $2.16 million budget shortfall would leave $18.48 million in the electric fund reserves, according to a budget summary.
Electric sales were budgeted sightly higher in 2021 compared to 2020 due to marginal meter growth and the April 1 rate increase, District Financial Analyst Ruth Kuch said.
Clallam and other PUDs purchase electricity from Bonneville Power Administration, which raises wholesale rates an average of 5.5 percent every two years, Worthington said.
Gov. Jay Inslee has extended a moratorium on utility disconnects and late fees through April 30 because of COVID-19.
The Clallam County PUD electric budget contains no revenue from late fees until the fourth quarter of 2021, Kuch said.
The PUD’s water budget shows $5.31 million in revenues and $6.98 million in expenses. A $1.67 million budget shortfall would leave $1.47 million in water fund reserves.
The approved wastewater budget for 2021 has $159,484 in revenue and $159,518 in expenses. A $34 shortfall would leave $55,126 in the sewer fund reserve.
