The Franklin Public Utility District may raise electric rates 3 percent starting May 1.
The proposal will be considered by the district's commissioners at a meeting at 1 p.m. Tuesday at 1411 W. Clark St., Pasco.
A year ago the commission considered adopting an 8 percent increase in spring 2013, which would have required no increase this year.
But the PUD's rate advisory committee told commissioners that it preferred smaller, regular increases to larger sporadic ones.
The commission, after multiple public hearings, agreed and adopted a 4.9 percent increase in 2013, with plans for another increase, possibly as high as 4.9 percent, this year.
After reviewing budget numbers, the staff is recommending holding the increase to 3 percent this year. The rate advisory committee met recently and agreed to that recommendation.
An increase of 3 percent rather than 4.9 percent would allow the PUD to meet its financial obligations and minimize near-term impacts to customers, said Debbie Bone-Harris, PUD spokeswoman. However, another rate increase might be needed next year.
The rate increase last year brought the monthly bill for a typical home using 1,400 kilowatt-hours to $118.05. A 3 percent increase would raise that to $121.59.
The PUD purchases 85 percent of its power from the Bonneville Power Administration, and the PUD had a 6 percent increase in its power costs from BPA in October 2013, Bone-Harris said. In addition, the PUD's BPA transmission costs increased 13 percent.
BPA is expected to raise the PUD's power and transmission costs again in fall 2015 by the same percentages.
"As they continue to raise rates, we have to as well," Bone-Harris said.
Wholesale power purchases make up almost 70 percent of the PUD's annual expenses, but it is constantly looking for ways to cut costs in remaining areas in which it has more discretion, she said.
The rate increase last year was the first time the PUD had raised rates since 2005, when rates jumped 10.5 percent. Twice in those eight years, rates dropped.
-- Annette Cary: 582-1533; email@example.com; Twitter: @HanfordNews