Forest Grove Light & Power proposes 3 percent rate increase
Electricity customers in Forest Grove could see their rates go up again early next year, though not by as much as in the past three years.
At the Monday, Nov. 27, meeting of the Forest Grove City Council, staff proposed a 3 percent rate increase that would take effect in 2018.
Councilors did not vote on the proposal but directed staff to move forward, said City Recorder Anna Ruggles.
A cost-of-service study three years ago recommended the City Council raise electric rates in Forest Grove by 6 percent every fiscal year until 2019.
The study consultant also developed a model that could be used on an ongoing basis to determine the rate changes needed to meet Forest Grove Light & Power's financial goals, according to the Nov. 27 presentation.
Yearly reviews of the department's financial state showed 6 percent increases were unnecessary.
After a 6 percent increase in January 2015, subsequent increases have been smaller — 4.5 percent in January 2016 and 4.75 percent last February.
A public hearing on the proposed rate increase is planned for the council's Monday, Jan. 8, meeting in the Forest Grove Community Auditorium, 1915 Main St.
If approved, the rate increase would become effective for services provided on or after Feb. 20. The increase would show up on the April utility bills, according to city staff.
The city calculates that the average residential customer will see an increase of about $2.35 per month if the rate increase takes effect.
Forest Grove Light & Power purchases electricity from the Bonneville Power Administration, a federal agency that provides power generated from hydroelectric dams along the Columbia River.
According to Monday's presentation, the agency raised its rate for the power it sells to Forest Grove by 3.14 percent in October, prompting the city to pass on much of that hike to its utility customers.
A fraction of this year's rate increase and the proposed increase for 2018 is earmarked to cover Forest Grove Light & Power's share of increases in the city's defined benefit plan costs, the staff presentation noted. Without that piece of the increase, according to the presentation, rates would have increased by 2.75 percent next year instead of 3 percent.
Information on the rate proposal is included in the city's "FYI Forest Grove" newsletter. It is also being sent out in the city's December utility bills.
By Mark Miller
Editor, Forest Grove News-Times
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