By Jim Stanford on July 12, 2011
Faced with rising electricity costs, Lower Valley Energy again has raised the rate for all residents, rather than charging more to the heaviest consumers of power.
This marks the second time in five years that Lower Valley has passed on higher costs to everyone, instead of raising rates for those who use the most electricity and thereby drive up the costs for the cooperative as a whole.
Lower Valley’s board of directors voted June 30 to charge a higher residential rate in winter. The rate will stay the same in summer, when there is less demand for electricity. The new rate will take effect in October.
The board dismissed another option for a tiered system, in which residents would pay a higher rate above a certain threshold for power consumption. Such a system would have created a strong financial incentive for conservation.
Now, the higher winter rate will fall on the shoulders of low-income residents who are more likely to be living in poorly insulated homes. Power hogs with heated driveways and large homes will pay the same rate as skids.
The tiered system would have mirrored the way Bonneville Power Administration charges Lower Valley for electricity. The cooperative must pay a higher rate for power above a certain quantity BPA provides.
Board member Ted Ladd made the motion in favor of the seasonal rate, according to the News&Guide. Pete Cook, Fred Brog and Nancy Winters joined him in approval, while Dean Lewis and Linda Schmidt voted against it, advocating instead for a flat increase for all seasons.
According to the News&Guide, trustees had a “brief discussion” about the tiered system, under which households that use more energy would be charged a higher rate. Tram Whitehurst reports:
But that idea was quickly put to rest, with board members questioning where the division would fall and reluctant to punish large homes.
Brog spoke for most of the board when he said, “I’m still convinced that large residential should not have to subsidize the smaller guys.”
No, instead the smaller consumers who conserve the most will wind up subsidizing trophy homes.
In addition to hiking rates, in recent years Lower Valley raised the base service charge for all residents, from $5 to $15 per month. This fee is to recoup the costs of infrastructure — power transmission lines, transformers and such. The same fee is charged whether residents use 200 kilowatt hours per month or 2,000, even though the larger consumers require greater transmission capacity, especially at times of peak demand (i.e. Christmas-New Year’s).
Even with the seasonal change, under the current pricing system large consumers of power “aren’t paying their fair share,” says Denny Emory, a Wilson businessman who has served on LVE advisory committees. “Not even close.”
Lower Valley began restructuring electricity rates in 2006 to reflect BPA’s limited supply of cheap hydropower; BPA had informed local utilities that because of growth and drought in the Pacific Northwest, it would not be able to meet all demand for electricity beyond 2011.
At that time, about 70 percent of Lower Valley households used less than 2,000 kilowatt hours per month. However, 10 percent used more than 18,000 kWh per month. The average house in Lower Valley’s service area, which includes Star Valley and Jackson Hole, used about 1,500 kWh.
Before the restructuring began, the pricing was even worse, with large consumers of power paying a cheaper rate.
It’s dismaying to hear our cooperative’s board of directors sound so beholden to owners of large homes. Instead of putting real price incentives for conservation into the rate structure, Lower Valley will plod along with token, feel-good measures such as free lightbulbs and the Energy Sustainability Project.
Hardly anyone pays attention to LVE elections, and in fact this year’s election was called off after no one challenged three incumbents. Perhaps it’s time we put up candidates who are not afraid to make power hogs pay their fair share.
(Dam photo via Save Our Wild Salmon)