Dear Members,

Last month, I announced my belief that an increase in Hood River Electric Cooperative’s retail electric rates would be needed in 2017.

There are still several variables—the size and design of the expected wholesale power and transmission cost increases from the Bonneville Power Administration being the major ones—that need firming up before specific retail rate impacts can be determined.

I also will consider internal operating costs and staffing levels as I work to refine a proposal for consideration by your board of directors. Once overall annual operating and power supply costs are estimated, they must be equitably assigned to the various customer classes.

I recently undertook an analysis of annual energy use by the four customer classes: residential, small commercial, large commercial and irrigation. Residential and small commercial customers tend to have higher usage in very hot and very cold temperatures. Irrigation usage is dependent on how hot, wet or dry the summer season is. Large commercial accounts vary depending on the nature of the business.

A number of factors affect usage by cold storage and fruit packing facilities—many of which are our largest customers. More energy is required when orchard yields and temperatures at harvest time are high. When considering the division of power costs among customer classes, I evaluate their growth in requirements throughout time.

In the past 10 years, residential customer annual energy sales have decreased modestly from 51.7 million kilowatt-hours to 50.7 million kWh. Small commercial requirements increased from 5.5 kWh to 5.7 million kWh, and irrigation from 1.4 kWh to 2.0 million kWh.

A significant change occurred with the large commercial class—gradually but steadily increasing from 44.3 million kWh to 54.9 million kWh in the past 10 years. I will continue to provide updates as more information becomes available.

John Gerstenberger, Manager