Editorials

High power rates still a risk as Trump proposes privatizing BPA

The U.S. Department of Energy dropped plans to privatize the Bonneville Power Administration last May, but the Trump administration again has proposed selling BPA assets.
The U.S. Department of Energy dropped plans to privatize the Bonneville Power Administration last May, but the Trump administration again has proposed selling BPA assets. Herald file

We thought Northwest ratepayers could relax after the U.S. Department of Energy told lawmakers last May it would not consider privatizing the Bonneville Power Administration.

We were wrong.

The frightening proposal already has re-emerged, and it is infuriating.

This time, the ill-conceived idea appears in a 132-page government reform report released last month by the Trump administration.

It is titled “Delivering Government Solutions in the 21st Century,” and a section of it encourages the selling of BPA power lines and other assets.

The document says that ownership of BPA and other public power entities in the country would be “best carried out by the private sector, where there are appropriate market and regulatory incentives.”

Nonsense.

The BPA is self-funding thanks to an ingenious rate plan implemented years ago.

The capital investment, operation and maintenance of the BPA’s transmission system are paid for by those who buy the electricity through local utilities. And the best part? The power is provided to the region at cost.

If BPA power lines and other assets were sold, that would no longer be the case.

Private investors surely would want to make a profit, and then our relatively low energy rates likely would disappear.

U.S. Sen. Maria Cantwell, D-Wash., was quick to blast the Trump administration for bringing this plan forward yet again. She insists the proposal would “hit middle-class families in the pocketbook and hinder small business growth across the Northwest.”

Her office notes that the Northwest Power and Conservation Council (NPCC) estimates the privatization plan could raise electricity rates by 40 percent, and compares Trump’s proposal to what led to the Enron price-gouging scandal in the early 2000’s.

“Besides causing a direct and detrimental impact on power rates, the privatization of the BPA transmission system would leave the region vulnerable to market manipulation by creating artificial transmission restraints,” according to a NPCC report released last March.

“During the 2000-2001 energy crisis, Enron Corporation did just that to boost its profits. … Having a federal agency in charge of this critical regional asset ensures a more stable transmission system in the region and throughout the entire West,” the NPCC said.

BPA operates and maintains nearly three-fourths of the high-voltage transmission that takes places throughout Washington, Oregon, Idaho and other nearby states including California, Montana, Wyoming, Utah and Nevada.

Along with a potential rate hike, there also is a valid concern that if the BPA grid were sold to private investors, unprofitable lines serving rural areas might be abandoned. That would be a terrible blow to farmers and others who live far away from urban centers.

Despite the many times federal lawmakers have opposed it, privatizing public power transmission systems appears to be an idea too tempting for federal officials to give up.

The current administration isn’t the first to pursue it – even Obama, Clinton, George W. Bush and Reagan administrations considered it.

We hope Trump soon will give up too and leave the BPA alone.

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