Commission recap, 4/23/2024 — Discussion continues about preferred rate for ‘ag services.’ More...

Note: The commission recording is delayed this week due to technical issues.We're working to get it posted ASAP.

Discussion continues about a preferred rate for 'ag services'

A lower electric rate for some ag-related activities beyond irrigation could become a new offering for county farms and ranches, as Grant PUD commissioners continue their ongoing discussion about how to improve the utility’s current rate-setting policy.

The proposed “Agricultural Service” rate would apply to electricity that powers certain non-irrigation ag activities, including growing crops, raising livestock and processing or storing agricultural products.

Many ag businesses’ non-irrigation electric service is currently billed under Rate Schedule 2 for General Service or Rate Schedule 7 for Large General Service. Both of these rate classes also include non-ag activities, ranging from small shops to big-box retailers, who can often pass cost increases on to their customers. Farmers usually can’t raise prices to compensate for cost increases. See Grant PUD’s full rate list here.

Irrigation customers (Rate Schedule 3) already receive a below-cost rate for the energy needed to pump water to their farms.

Specific “Agricultural Service” rates have yet to be determined. Staff will provide the commission with suggested rates for further study in the coming months.

Commission President Tom Flint and Commission Treasurer Larry Schaapman both urged staff to ensure any rate changes don’t create unintended consequences. Commissioner Judy Wilson favored making any new rate as uncomplicated as possible.

“I don’t want the process to be misused,” Flint said. “The goal is to have a benefit for the wholesale producers, because they don’t have the retail component of passing on price increases.”

Staff’s draft plan calls for the new rate to be available to customers as early as September 2024, but commissioners Tuesday asked for a longer timeline for more analysis.
See the full presentation on pages 17-33 of the presentation materials. Hear the discussion at _____ on the commission audio.

Commissioners also:
— Heard that goals for the number and duration of power outages continue to exceed goals.Ron Alexander, Managing Director of Power Delivery, said the team’s work to reduce the impact of outages was recognized by the American Public Power Association, which placed the utility in the top quartile, “gold standard” for outages. “It’s a big achievement for us, but there is more to improve on,” Alexander said. For more information see pages 72-94 of the presentation materials.  Hear a brief discussion at X:XX:XX on the commission audio.

— Learned that Grant PUD billed for an average of almost 704 average megawatts of electricity used across all customer classes from January through March – just over 5% less than the 741 average megawatts forecasted.

• The biggest forecast shortfall came from large industrial customers, who were billed for nearly 286 average megawatts of power, down just over 12% from their forecasted energy use of nearly 326 average megawatts. Staff anticipates the decline resulted from an equipment failure at one of the county’s large manufacturers.
• Energy use billed as Grant PUD’s new Rate Schedule 19 for commercial fast-charging stations around Grant County has shown steady growth, year over year, with three, hour-long periods in March surpassing 1 average megawatt of energy use. The previous hour-long peak was 0.97 average megawatts on August 4, 2023.
• The number of residential customers grew 1.5% to 41,723, year over year, through the first quarter. The number of commercial customers grew 2.6%, year over year.

See the full presentation on pages 17-33 of the presentation materials. Hear the discussion at _____ on the commission audio.

— Heard from Moss Adams independent auditors that Grant PUD passed the audit of its 2023 financial statements with flying colors. Audit team members told commissioners the audit was clean, with no reportable findings nor material weaknesses. “We like to trust and verify and we rely on our employees to do their jobs,” Commission President Tom Flint said. “We depend on you for your independent view.” See the full presentation on pages 41-51 of the presentation materials. Hear the discussion at _____ on the commission audio.

— Unanimously approved what is expected to be the final change order – $9.5 million – to the contract with North Sky Communications LLC to complete Grant PUD’s fiber-optic network, making it available to all residents of Grant County by year-end. The change order brings the total not-to-exceed contract amount to $96.5 million. For more information, see pages 8-22 of the commission packet.

— Unanimously authorized the general manager to execute a $1,078,345 contract 270-12016 with Mercer International, Inc. to supply seven oil/water separator tank units to be installed adjacent to turbine/generating units at Priest Rapids Dam. The units help keep any spilled oil from contaminating the Columbia River. For more information, see pages 23-47 of the commission packet.