Public power groups, Kotek tangle over BPA’s proposed 6.3% supplemental rate increase

By JONATHAN BACH/The Oregonian/OregonLive

Gov. Tina Kotek on Friday pushed back at critics who are blaming the state of Oregon’s litigation to promote salmon recovery in the Columbia River Basin for a proposed $250 million supplemental rate increase that the Bonneville Power Administration announced earlier this week.

In a letter to a coalition of public power advocates and industry groups, Kotek said they should instead direct their ire toward the Trump administration and its decision last year to withdraw from an agreement that sought to end decades of litigation that pits hydropower production versus salmon recovery in the region.

“We want affordable, clean energy and we want to protect the salmon runs that feed our rural economies,” Kotek said in a letter to the Northwest River Partners Coalition, which includes an array of business and utility interests. “However, there is a single entity that is jeopardizing our shared goals, and it is important that we be aligned in a unified advocacy strategy to meet this moment.”

Following the federal government’s decision last summer to abandon the Biden-era salmon restoration agreement, environmental groups, tribes and the state of Oregon filed a new lawsuit demanding protections for endangered salmon species in the rivers.

In February, a federal judge issued a preliminary injunction mandating the implementation of a new spill regime at Columbia and Snake rivers dams — an operational plan that requires dam operators to send water through spillways rather than through power-producing turbines.

On Thursday, the Bonneville Power Administration said the court-ordered spill increases would lead to a $250 million revenue shortfall, forcing it to raise rates by up to 6.3%, including for public utilities serving more than a million customers in Oregon. The final decision on the rate increase is due Dec. 18. The BPA had already established an average yearly rate increase of 8.9 percent for 2026-2028.

The Central Lincoln People’s Utility District, whose service area stretches from north Lincoln County into Coos County, receives all of its power from the BPA. Its rates are among the lowest in the state.

“Gov. Kotek’s anti-hydropower lawsuit will cause higher bills, less reliability, and more reliance on fossil fuels,” Tony Schacher, general manager of Salem Electric, said in a new release issued Thursday by a coalition of public utilities. “The cost burden will fall on the most vulnerable Oregonians, who will be left wondering if they should pay their electricity bill or cover other essential needs, like food or medicine.”

Business and power interests, including Oregon Business & Industry, the Oregon Farm Bureau and the Public Power Council, told Kotek in an Aug. 24 letter that the state’s court position would lead to a spike in electricity bills, increase the carbon intensity of the electric grid and increase the risk of blackouts.

They urged her to drop the litigation and instead lead “a collaborative conversation to find sustainable, balanced, science-based solutions that work for people and fish.”

Kotek’s response on Friday said the proposed Bonneville rate hike was directly tied to Trump Administration’s decision to pull out of the 2023 agreement and “failure to follow the law.

“We must be clear with our constituencies that affordability issues at the heart of your letter can be resolved if we collectively push the federal government to come back to the negotiating table,” she wrote to members of the coalition.

Kotek told the group that she agreed “a negotiated political solution, not litigation” is the best route and was the spirit in which her office helped coordinate the 2023 agreement.

It’s far from clear that the members of the coalition want to return to an agreement resembling the 2023 accords. Public power advocates said they were shut out of the negotiation process that led to the agreement, and called the administration’s decision to abandon them a “necessary course correction toward energy reliability, affordability, and transparency.” Republicans in Congress also applauded the move.

Scott Simms, CEO and executive director of the Public Power Council, the lead defendant intervener for public power in the federal lawsuit, said he was heartened by Kotek’s letter and her calls for resumed talks.

If that happened, Simms said, some elements of the 2023 agreement — which set operations for 2024 and 2025 — could serve as a jumping off point, particularly around dam “flexibility” for power and salmon. Renewed talks would need to include a wider group of parties, including utilities, river commerce businesses such as barging companies and recreational vessels, irrigation and farming interests and the tribes, not just from Oregon and Washington, but also Montana and Idaho, he said.

  • Jonathan Bach is a business reporter for The Oregonian/OregonLive and can be reached at [email protected]

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