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BPA (Transmission) Rates to Remain Stable

by Erik Siemers
Portland Business Journal, December 16, 2010

The Bonneville Power Administration on Thursday reached a deal to avoid a rate increase for customers that use the federal utility's high-voltage power lines.

But the settlement may be little more than a two-year delay before Portland-based BPA looks for ways to recoup the costs of new investments in its transmission system. The BPA said it will use some of its financial reserves to cover transmission costs to keep rates level for fiscal years 2012 and 2013.

Cathy Ehli, the BPA's vice president of transmission marketing and sales, said "solid transmission planning and management" allowed the agency to increase federal reserves, providing some relief to customers during a tough economy.

She acknowledged that the relief could be short-lived.

The BPA must still deal with costs related to four proposed transmission projects, efforts to integrate wind, new security measures and capital projects to replace aging transmission lines and equipment.

"In the short-term, we are in a good position to avoid increasing rates," Ehli said in a news release.. "However, as we look to our next rate case, we will have to deal with the impact of these rising costs."

The issue is separate from the BPA's business as a distributor of wholesale power.

The settlement also doesn't cover the costs of integrating wind power into the grid or use of the Montana Intertie, a 500-kilovolt power line partially-owned by BPA that integrates electricity from the coal-fired Colstrip plant in Montana. Those issues will be litigated in a future rate case, BPA said.

Erik Siemers
BPA (Transmission) Rates to Remain Stable
Portland Business Journal, December 16, 2010

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