Tucannon.jpg

PGE's Tucannon River wind farm in Washington

(Courtesy of PGE)

Portland General Electric has asked state utility regulators to approve a 5.6 percent rate increase effective next January to cover increased costs for transmission upgrades and other investments to enhance grid reliability and security.

PGE is effectively asking regulators to approve $100 million in new revenue, none of it tied to any big new generating resources. The request comes on the heels of rate increases in 2014, 2015 and 2016 that collectively raised rates by about 7 percent. The latter two were driven by investments in new gas plants and a wind farm.

The new request varies widely by customer class. The largest increase - 7.1 percent - would be borne by residential customers. The average customer using 820 kilowatt hours a month would see their electricity bill increase by $7.30, to about $105, the company said.

Small business and commercial customers would see rates go up 5.7 percent and 4.2 percent, respectively, and commercial customers would see increases ranging from 1.2 percent to 3.5 percent.

"We understand the impact price increases have on our customers, and we do not make this request lightly, PGE chief executive Jim Piro said in a news release. "These are important investments that will meet our customers' expectations for safe and resilient service."

The rate case is a 10-month process in which the company will look to justify the request and other stakeholders will try to persuade regulators to dial it back.

PGE's run of big investments has ratepayer advocates looking skeptically at the company's plans to add even more new resources to replace the coal plant in Boardman, which is scheduled to close in 2020, and to comply with the the state's renewable energy mandates.

Bob Jenks, executive director of the Citizen's Utility Board of Oregon, said his organization will be pushing back on the company to justify its cost allocation, and why residential customers are being saddled with such a significant increase.

He also noted that during the last few years, PGE investments had significantly increased the value of the property on which it is allowed to earn a return, known as its rate base. The utility, which once bought a big slice of its electricity in wholesale markets, but is now generating most of its own power in company-owned power plants.

Some advocates are lobbying for the utility to forgo building new plants to replace Boardman, and go back to the wholesale market, where prices are cheap.

"As cheap as prices are right now, we're putting all this rate-based investment in," Jenks said. "It doesn't make a whole lot of sense. I think they're attempting to overbuild their system in a way that isn't good for customers."

_Ted Sickinger

503-221-8505; @tedsickinger