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Power Costs Expected to Remain High by Dave Wilkins Capital Press, October 26, 2001

Idaho irrigators are likely to pay a hefty price again next year to pump water to their crops, and they won't have the option of power buyback programs to fall back on, some water officials said.

Farmers who are Idaho Power Co. irrigation customers paid about 5.1 cents per kilowatt hour to run their pumps this year, and that isn't likely to change much for the 2002 irrigation season.

"It's not going to go down, but at least it probably wont' go up," said Lynn Tominaga, executive director of the Idaho Irrigation Pumpers Association.

Exactly what pumping rates will be for the 2002 irrigation season is difficult to know right now, Tominaga said.

"A lot of it is going to depend on the winter snowpack," he said.

The Idaho Public Utilities Commission in late September granted Idaho Power $47 million in power cost adjustments that had been deferred from the company's 2001 application. Final irrigation power rates for 2002 won't be established until after the Idaho Public Utilities Commission conducts its annual power cost adjustment hearings in May.

Many Idaho farmers participated in power buy-back programs offered this year through Idaho Power and Utah Power, a division of PacifiCorp. But those programs, which paid farmers to cut back on their irrigation pumping, aren't expected to be offered in 2002.

"The Bonneville Power Administration, PacifiCorp and Idaho Power -- none of those three are planning on having a buy-back program next year," Tominaga said.

Barring a very poor water year, Idaho Power is expected to have plenty of electricity to sell to its customers next year. The company's largest industrial customer, FMC/Astaris Corp. announced earlier this month that it will close its Pocatello phosphorus plant by the end of the year.

"As long as Idaho Power has the water available next year, they'll have more power than they can sell," Tominaga said.

Power costs can be a significant portion of the total input costs for farmers, especially those who use deep wells or high lift pumping stations to irritage their crops.

In areas like Elmore County, where some farmers pump water 500 to 600 feet, energy costs dictate crop selection. High-lift pumping costs can eat up half of the gross return on a wheat crop, one Mountain Home area farmer said.

Potato Growers of Idaho didn't endorse processing contracts for the 2001 crop in part because french-fry makers refused to factor in higher input costs, including those for power, said PGI interim executive director Keith Esplin.

"Growers just can't make money on these contracts," Esplin said.

French-fry makers paid, on average, about $4.42 per hundredweight of ro field run Russet Burbanks in Idaho this year.

Increased power costs were also a factor in reducing Idaho potato acreage this year by about 11 percent, Esplin said.

He expects that irrigation pumping costs won't decrease this year, and could possibly increase.

"I wouldn't expect much of a decrease in pumping rates over what we paid during the past irrigation season," Esplin said.

Some Idaho farmers who participated in power buy-back programs this summer installed diesel generators to run irrigation pumps so they could still produce crops.

Those generators could be pressed into service again this year if electric rates remain high.

"If growers see any more of an increase in power rates, I think a lot of these guys will stay with their diesel generators," Esplin said.

• Idaho Power Co. irrigation customers paid about 5.1 cents per kilowatt hour during the 2001 irrigation season, and increase of about 31 percent from the year before. The increase was mainly due to the company's increased costs of procuring wholesale energy during a severe drought.

• Agriculture officials expect that those 2001 rates won't change substantially for the 2002 irrigation season, once the costs of a buy-back program are factored into the annual power cost adjustment formula.

• The Idaho Public Utilities Commission will conduct its annual Power Cost Adjustment hearings next May, and that will determine the rates that irrigators actuall pay in 2002.

Related Pages:
FMC to Close Pocatello Plant by Dave Wilkins, Capital Press, 10/19/01