The Hermiston City Council voted Monday night to raise electricity rates in three phases over an 18-month period beginning in March 2025.
The council voted to raise Hermiston Energy Services (HES) rates by 7.84 percent increase in March 2025, 6.49 percent in March 2026 and a 5.19 percent increase in October 2026.
HES General Manager Nate Rivera said the primary factors leading to the need to raise rates are increases in wholesale electricity prices from Bonneville Power Administration (BPA), material cost increases and HES’ Construction Work Plan.
“Everything in our industry has increased in price over the last five years,” Rivera said.
Overhead and underground cable costs have increased 194 percent, he said. Power pole costs have gone up 91 percent and transformer costs have increased by 108 percent.
Under its Construction Work Plan, HES plans to replace all remaining overhead copper and URD conductors. Rivera said the existing copper lines are some of the oldest in the system at over 50 years old and are the most likely to cause outages.
The last time the Hermiston City Council approved an HES rate increase was in 2021 and it was implemented in two phases – a 6.98 percent increase in January 2021 and a 6.9 percent increase in October 2021.
Rivera said HES currently has the lowest rate in the region. Residential customers today pay an average of $124 compared to $129 for Benton PUD, $138 for UEC and $218 for Pacific Power customers. The Oregon average is $235.
Under the full rate adjustment, Rivera said HES customers would pay $150 on average per month.
“It’s still a competitive rate,” Rivera said, adding that other utilities will likely also have to raise their rates.
Councilor Nancy Peterson said the feedback they’ve heard is that no one cares what other utilities are charging. They care about how much they are having to pay, Peterson said.
“For us, it’s important,” Peterson said. “But what the community hears is ‘my rate is going up.’ ”
HES conducted a survey in November with only 40 HES members taking part. The survey showed the top priority among HES customers was cost, followed by reliability, safety, customer service, and environmental impact.
The survey asked whether customers would prefer their rates to go up over two phases or three. A total of 65.9 percent preferred to see the increase over three phases over an 18-month period rather than two phases over a 12-month period or a one-time rate increase in June 2025.
Rivera acknowledged the survey only represented a fraction of the 5,500 customers, “but it does give some feedback of people who took the survey.”
Rivera also said the survey showed 58.6 percent of respondents preferred smaller, predictable rate increases annually.
Rivera told the council that HES has several programs available to help customers keep electricity costs down including heat pump replacement, weatherization programs, clothes washer rebates and water heater rebates. HES also offers free energy audits.
Mayor Dave Drotzmann and Councilor Roy Barron said they like the idea of smaller, annual rate increases rather than hitting customers with bigger but more infrequent rate hikes.
“Unless we come out with some alternative energy sources that bring down the cost of energy, I can’t see the cost of energy going down any time soon,” Drotzmann said. “So, we should expect that it’s going to cost us more each year. Having that steady rate is what we’re hearing from the community.”
Rivera said rate increases are never fun, but necessary to ensure the reliability of the system, particularly for the most vulnerable in the community when the temperatures soar over 100 degrees in the summer or plunge below freezing in the winter.
“It does come with a price, but it comes also with protecting people in our community,” Rivera said.
Councilor Jackie Linton preferred spreading the rate hikes over three phases “to make it easier on people.”
The council voted 7-1 to split the rate increases into three phases with Barron voting in opposition.
“This is never an easy conversation,” Drotzmann said. He thanked the council for its leadership and for “listening to the community that said they preferred the three-split option.”
