2012 will usher in new rates for customers of PacifiCorp and Portland General Electric (PGE) to reflect changes in power costs experienced by the utilities in 2011. Power costs include the purchase, generation and delivery of electricity from its source to homes and businesses.
PacifiCorp customers will see their rates go up, while PGE customers will pay a little less beginning January 1, 2012.
The 4.4 percent overall rate increase amounts to $51 million. The increase for residential customers is approximately 3.8 percent. The average monthly bill will increase by $3.46 from $93.42 to $96.88 for a residential customer using 950 kWh (per month). The increase for large general service customers will be approximately 6.1 percent.
The largest single factor in the increase was higher coal costs. Another important factor was an increase in demand. These two factors accounted for approximately two thirds of the rate increase.
The Commission trimmed $10.9 million from the amount PacifiCorp initially asked requested.
The1.3 percent overall rate reduction for PGE amounts to $21.8 million.
The rate decrease for residential customers is approximately 0.9 percent. The average monthly bill for a typical customer using 900 kWh per month will drop by $1.23 from $99.57 to $98.34. Rates for the large non-residential customers served under Schedule 89 will decrease by approximately 2.1 percent.
The reduction is due to lower per unit contract costs and some replacement of non-hydro contracts with less expensive market purchases.
The Commission adopted annual adjustments after the 2001 energy crisis, when market electricity and gas prices became much more volatile than they had been in the past. In a volatile market environment, if rates are not reset frequently, a utility can easily collect much more or much less than its actual power costs. Given that power costs change substantially from year to year, rates are changed annually.