FAQ's on new rates effective April 1, 2024

On Jan. 23, Grant PUD Commissioners approved new electrical service rates for our customers. The new rates, which includes an overall 3% increase, with specific allocations for each customer group will begin on April 1, 2024. To learn more about the decision making behind the rate increase read our recap of the Jan. 23 commission meeting. Below you’ll find answers to general questions we have received about the rate increase during our public meetings and individual discussions with customers.

Why does Grant PUD need to raise rates?

Each year, we look at how our retail rates cover operating expenses to serve our retail customers. We have a goal each year of making sure that projected retail power sales revenue covers our budgeted retail operating expenses. This modest 3% overall rate increase will help us keep up with increasing costs while at the same time ensuring we meet our commission’s goal of small, predictable rate increases.

Why don’t all customer groups get the same rate increase?

Commissioners are presently working under a rate-making policy which establishes certain rate trajectories and targets that provide predictable increases for our customers. Because customers have different power needs and use electricity in a different way, the costs to serve each group of customers are not the same. By factoring in the estimated costs to serve our customers when making these rate adjustments, commissioners are helping to move prices closer to those targets for each of our retail classes. Our commissioners and our customers have had considerable discussion about this rate-setting methodology over the past year and are expected to engage in a public process this year to determine how costs will determine rates in the future.

Won’t this add to our customers’ inflation burdens? 

We understand how rising power prices impact our customers. We did not have a rate increase from 2018 through 2022. In 2023 and now in 2024, we’ve tried to manage rising costs by having small, incremental increases of 3% each year to absorb the impacts of overall inflation and supply-chain shortages. By doing this, we can avoid the kind of “rate shock” that other power customers in the state are experiencing when their utilities need double-digit annual rate increases to catch up to these rising costs. 

How will Grant PUD’s power rates compare with other utilities?

In October 2023, the average residential cost per kilowatt hour was 16.11 cents in the United States. In Washington state, the cost was 11.34 cents. In Grant County, that cost will increase from 5.7 to approximately 5.9 cents per kilowatt hour once these rates take effect on April 1, 2024. 

Why will the rates take effect on April 1?

Historically, we have chosen April to revise our retail rates because it is typically a low-power use month for most customers and to give our staff the necessary time to make any adjustments and perform the appropriate testing to ensure that customer billing is accurate

How does Grant PUD help those struggling to pay their power bills?

We have several things that can help. We conduct home energy audits to identify steps customers can take to make their buildings more energy efficient. We offer rebate programs to help with the costs of making energy efficient upgrades. We have a rate discount program for senior or disabled low-income customers. We also administer a payment-assistance program called Share the Warmth and we work with other government and charitable agencies who have payment assistance programs. If you need some assistance, please contact us at 509-766-2505.

Why raise rates on local customers this year when Grant PUD had higher than budgeted wholesale power revenue

In 2023, Grant PUD had better than expected revenues from wholesale power sales (selling power to other utilities). This additional revenue was transferred to our Reserve and Contingency fund and will also be used to offset issuing debt. Revenue from wholesale power is volatile. This is why we choose to use the proceeds to maintain a healthy R&C fund to avoid retail rate surcharges in the case of a sudden financial impact. We will also use funds strategically to pay capital costs to fund improvements for our power system and wholesale fiber service, reducing the amount of debt we need to issue. Strategically managing our cash reserve levels helps us maintain our high bond ratings, which means we pay less interest on our capital debt and keep costs low for our customers. In 2023, Grant PUD also received additional revenue from a carbon-reduction program administered by the state of Washington. These specific funds will be applied to the benefit of our customers through state-approved means

How can I get involved to express my thoughts about rates or other PUD topics?

Customers are always welcomed to attend our commission meetings, which are open to the public. Generally, there is a public comment period at 1 p.m. Members of the public are also invited to participate in our budget and rate hearings when they are scheduled, normally in October-November of each year. They can also provide public comment via our website.

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