Come May, Hermiston Energy Services (HES) customers could see something they haven’t seen in more than a dozen years – a rate increase.
HES Superintendent Nate Rivera told the Hermiston City Council Monday night that the utility has resisted rate hikes in recent years, instead opting to dip into its reserves to cover the increased cost of power charged to HES by the Bonneville Power Administration.
Rivera told the council that HES is recommending a nearly 11-percent rate increase in May, followed by a 9.5-percent rate hike in May 2016.
“We’re not out to make money – we’re a nonprofit,” Rivera said. “But we need to collect what it costs us.”
Rivera said an analysis of average regional utility bills for residential customers shows that with the proposed increase, HES customers would pay an average monthly bill of $112 compared to $113 for UEC customers, $121 for Oregon Trail Electric customers. The current monthly utility bill in Oregon is $158, and the average national monthly utility bill is $208.
HES was formed in October 2001 when Hermiston purchased Pacific Power’s local distribution facilities. The average monthly bill for Pacific Power customers is currently $193.
“There continues to be separation between the direction they (PacifiCorp) and the direction we’re going,” said Rivera.
There will be a public information meeting on the proposed rate hikes from 6 to 7 p.m. on Monday, March 2 at the Hermiston Conference Center.
Rivera said HES, which serves about 63 percent of Hermiston, is also taking steps to improve customer service with a focus on reducing outages. He said HES customers have experienced an increase in outages during the past several years. In 2014, HES customers experienced an average of 2.512 outages compared to 0.191 for UEC customers.
“Reliability is trending downward,” Rivera said, citing equipment that is 30 years old in some cases.
To address reliability issues, Rivera said HES will convert to an Advanced Metering Infrastructure system that will increase response time during outages, partner with UEC to build a new substation on the east side of town – a move, said Rivera, that will also provide for additional capacity for HES.
Hermiston Mayor Dave Drotzmann said Hermiston has a history of keeping its utility costs down.
“We want to continue to provide that as much as we can,” he said.
The council will consider the rate increase proposal at its March 9 meeting.
