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Ag, Business Oppose BPA Rate Hike by Carie L. Call Capital Press - July 26, 2002

HERMISTON, Ore. -- Bonneville Power Administration is considering raising its rates again this year, and farmers and business people plan to fight the effort.

Suzanee Sullivan's voice was breaking as she told Stephen Wright, chief executive officer of BPA, that if she has to pay increased rates, she will no longer be able to run her farm.

Wright told the 25 farmers and business people who attended a meeting June 14 at the Umatilla Electric Cooperative that because BPA bought power when the rates were high and is selling it when there is less demand, they are losing money. There are other factors that add to BPA's financial dilemma as well, including a medium water year for the dams to use to generate power and the cost of BPA's past dealings with Enron, Wright said.

"Things haven't played out the way we thought they would," he said. "We're worried about our financial situation."

Raising rates is one of several options BPA could take to meet all its financial obligations, Wright said, which includes a hefty yearly payment to the federal government for use of the dams. Right now, the exact course the company will take to deal with its debt is unknown.

"There is no profit motive for us," Wright said. "Our salaries don't go up if we raise rates. We are basically here to serve the public interest."

Sullivan owns Emerald Farms in Pasco and is a first-generation farmer who also runs a manufacturing facility. Sullivan said she can't afford to keep her business going if power prices continue to rise.

Sullivan said last year's power price hike and the taxes that went along with it amounted to a "horrific amount of money. I have to draw a line in the sand. I can either fight for these properties or walk away," Sullivan said.

In order to save money, John Weatherbee, the energy manager for the Pasco School District, said that even though teachers and principals are still working, he's turned off air conditioning in school buildings now that the children are home for the summer.

The Columbia Snake River Irrigators Association of Kennewick had a formal memo drafted to present to Wright.

"The buck -- or the lack thereof -- stops with us," the memo read. "The current market refuses to allow us to increase product prices to compensate for any increased operating costs."

Kim Puzey, director of the Port of Umatilla, said he would like to see BPA go into the red and ask for federal assistance instead of passing on costs to customers.

"There isn't an industry or farm out here that doesn't operate a little below assets occasionally," he said. "Help us stand with you. The voices of the people you are hearing today say they can accept the pain of increase collectively, but they cannot accept the pain individually."