The US's publicly owned hydro generator, Bonneville Power Administration has proposed a rate increase of 15% for wholesale customers. The increase should cover an expected shortfall this year of up to US$300M.
BPA has been under financial pressure since the California crisis, when it was forced to buy electricity at high prices to meet commitments. Its financial reserves, which totalled US$800M at the start of its 2001 fiscal year, now stand at US$200M. BPA already has raised its rates 46% over the past two years and will implement a temporary 8%increase in April.
This year the low price of electricity from other generators has affected BPA’s economics this year – normally, the company generates up to a quarter of its revenue from selling surplus power on the open market