Bonneville to Reduce
by Associated Press
PORTLAND, Ore. -- The Bonneville Power Administration said Thursday it will reduce wholesale power rates by 1.6 percent beginning with the new federal fiscal year on Oct. 1.
Improved revenue from surplus power sales and cost cutting allowed the rate decrease, officials said.
"This is the third year in a row that we have reduced our wholesale power rates, which is good news for our customers and the Northwest economy," said Steve Wright, BPA administrator.
The Portland-based federal power marketing agency expects to exceed its revenue forecasts for surplus power sales by about $20 million, despite water volume in the Columbia River Basin that reached only about 75 percent of normal, reducing the amount of electricity generated at federal dams.
But unusually heavy spring rains came just in time to take advantage of high market prices for surplus power caused by high natural gas prices and hot weather, Wright said. Natural gas is used to fuel turbine generators and hot weather increases demand for air conditioning.
Bonneville sells surplus power in the West Coast market and uses the revenue to help hold down rates for its Northwest utility customers.
The agency also reduced costs by more than $50 million below initial targets for fiscal 2005, he said.
Bonneville plans to release an initial wholesale power rate proposal for fiscal 2007-09 in October.
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