Electric rates for Franklin PUD customers could go up an average of 3 percent under a proposal being consider by the public utility district.
However, the average residential customer could see little difference in monthly bills as the commission considers a proposal to make sure all users are paying their fair share.
Tuesday the commission agreed to hold public hearings, which have yet to be scheduled, before it takes action on the proposed rate increase at its July 28 meeting.
The PUD’s Rate Advisory Committee is recommending the 3 percent increase take effect in September, followed by a possible increase of about 5 percent in May 2016.
The proposed increase is being driven by anticipated higher costs for electricity that the PUD buys to distribute to its customers.
The commission is considering raising rates for most classes of customers by 2.6 percent in September, but increasing rates for small irrigators by 10 percent. Together they would average a 3 percent increase in revenue.
A rate study concluded that the 700 to 800 small irrigation customers of the PUD were not paying their share of costs.
An increase in the base rate for residential customers is proposed, but a decrease in the kilowatt per hour charge.
The base cost of service for a home would increase from $22 to $34 a month. The monthly cost to have service available to a home is a little higher than that at $38, but officials were reluctant to consider that large of an increase.
If the base cost is not raised, then those not using electricity every month are subsidized by other ratepayers, said Commissioner Roger Wright. Those could include people who spend winters in warmer areas.
The kilowatt per hour charge would be dropped slightly to make the residential customer increase come to a total of 2.6 percent.
For the average customer paying nearly $122 a month now, the increase in the base rate and decrease in cost for electricity used would even out to a monthly bill of almost $123.
But customers with small homes who might use half that much electricity would see their monthly bill increase from nearly $72 to about $78.50.
Commissioners asked staff for more information on those customers, including how many there are.
The Rate Advisory Committee agreed that each rate class should cover its own costs, said Jean Ryckman, a member of the committee, in a letter distributed at the Tuesday commission meeting.
“We also listened carefully to concerns expressed by some committee members of potentially devastating impacts to low-income customers, especially those with fixed incomes,” the letter said.
The committee concluded that raising the residential base charge would have the least negative impact on low- and fixed-income customers while meeting the goal of collecting actual cost of service.
The PUD might need to raise rates again in May 2016, but the commission would revisit the proposal before then to see if an increase might be deferred or be less than 5 percent.
Franklin PUD rates were last raised 3 percent in May 2014.
Public hearings on the rate increase being considered now are expected to be scheduled in Pasco and Connell.