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Posted on Nov 2, 2018

This election season calls for facts about Grant PUD: Column

By Larry Schaapman 

I’m not choosing sides, but it’s time to move past the adversarial posturing toward the District and the Commission and get back to the facts – we have led well.
If you’re interested in some PUD history and facts, then read through the following facts. If you’re only interested in your “opinion absent of the truth” then don’t waste your time.

PUD formation
1930’s Grange’s lobbied for formation of PUD’s in the Legislature in desperation to receive power in the rural areas, they built no dams they just lobbied for electricity and to have local control.

Financing of the dams
Farmers didn’t put up a dime to build Priest or Wanapum dams in the 1950s, 14 Power Entities known as the Power Purchasers put up the money to finance the project of which they received 63.5% of the power generated, Grant could only receive up to 36.5% of the power for 50 years.

Grant’s share of power
When the two dams were built in the mid to late ’50s, Grant County was only using 2% of its 36.5% of the project until it started to grow.

Ability for more power
In 1999, Power Sales Contracts came to closure, and through legal challenges they were renegotiated in which we could eventually receive 100% of the power produced but we had to use the power in the county, we could not just take it, the county needed power growth to be able to take more. We were just about to our 36.5% max with no real growth.

Excess power
Surplus Power Sales were only generated from excess water that flowed on a given year and only on our 36.5%. We never had all the power to sell, all the power was never ours.

We have $1.3 billion worth of debt on a $2.1 billion dollar asset. Relicensing, Recreation, Fish Hatcheries, Acclamation Facilities as per 2007 FERC License Requirements have all driven that debt up, and we need to include the Wanapum Fracture, Rehabilitations of the Turbines and Generators that has been happening at Wanapum and just starting at Priest.

Debt restructure
We have restructured debt as to not have the 8% increases that we saw in 2012. We have spread that debt over the life of the asset.

Generational fairness
Generational fairness is nothing to be ashamed of. We have given future generations something to be proud of, a refurbished facility that will last past our 2052 license and be worth relicensing, maintaining and refurbishing again. Future generations will just be paying their share in their time, we don’t need to throw them the keys. If you think we should do that then let’s go back to 8 or more percent increases to pay it off.

Industrial benefit
If Large Industrials weren’t here, by 2014 we would have been paying 12% more for our power at that point and today that would be even higher.

Since 1997, the cost to serve analysis has always shown the same result, residential and irrigation have been paying under the cost to serve them. Residential was paying .88 out of every dollar to serve them, and irrigation was paying .60 out of every dollar to serve them, and Large Industrials were paying .35 more than every dollar to serve them. Surplus power sales do not generate revenue at today’s market prices to maintain those subsidies that they used to, and that’s why Large Industrials are critical to Grant’s financial health and your discounted rate.

Your power guaranteed
When Resolution 8768 was passed in 2015, there were a lot of beneficial parts to it, but one piece that some of the irrigators took exception to and that was requiring them to pay .80 out of every dollar to serve them instead of .60 and taking 10 years to get there. Residential was going to move down to .80 like irrigation in 10 years and both rate classes would enjoy the same discount. Large Industrials would move from .35 over cost to .15 over cost for every dollar and pay any additional power rates and fees that might be purchased in the future. It also gave Residential, General Service, Irrigators and Commercial Customers first rights to the Priest and Wanapum’s power as long as the Resolution stays in place. This means none of your power was or has been given away.

So that is some PUD history. These are the reasons why I vote the way I vote for you. I along with most of my fellow Commissioners have worked at keeping a Fair and Equitable mindset for all of Grant PUD’s customers. Never should there be favoritism or special interest consideration when serving customers. One should remain open minded in an ever changing world that benefits the greater good. Consider some of this history and changing dynamics as you cast your ballot. Hopefully this helps so one doesn’t have an “opinion absent of truth.”

Your District 3 Commissioner,
Larry Schaapman