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Economic and dam related articles

BPA Cuts Rates on Wholesale Power

by Mitch Lies
Capital Press, October 6, 2006

The Bonneville Power Administration confirmed this week it has cut wholesale power rates 3 percent, the fourth year in a row BPA has reduced its rates.

BPA Administrator Steve Wright cited collaboration among the utility's customers as a key factor in the rate decrease, which went into effect Oct. 1.

"Without the cooperative efforts of our customers, we would be putting in place a rate increase instead of a decrease," Wright said in the press release.

In July, BPA announced that for it to implement the rate decrease in October, it needed good utility customer participation in a newly developed Flexible PF Rate Program designed to address BPA's cash flow risk.

"The response was outstanding," Wright said,noting 33 utilities have signed up to date.

The Flexible PF Rate Program reduces the amount BPA needs in cash reserves. The program enables BPA to increase payments from participating customers on short notice and to decrease payments.

Stringent cost management and better-than-expected surplus power sales due to a normal water year plus two innovative financial arrangements contributed to the rate decrease, Wright said.

BPA is a not-for-profit federal agency that markets about 40 percent of the electricity consumed in the Northwest.

Mitch Lies
BPA Cuts Rates on Wholesale Power
Capital Press, October 6, 2006

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