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Our 1995 Long Range Plan pointed out several million dollars OPALCO must invest in our system over the next several years to provide reliable power, not to mention the ten to fifteen million dollars BPA will spend on a new submarine cable to serve us. If we can reduce our loads, we can defer these investments for several years. We are in the final stages of putting together a Load Management Program that will enable us to accomplish this. To be successful, we will need about 50% of our residential members to participate (that is 4,000 of you). I think we will need to offer some financial incentive to get 4,000 people to sign up. For example, we could reduce your electric bill by $1 to $2 per month for management of electric water heaters, or $2 to $3 per month for management of electric heat. While the actual Load Management Program is still under development, assume that this program is acceptable to a majority of you (if it isn't, we can't defer our needed investment, and the whole thing is a waste of time). 4,000 people times $5 per month times 12 months per year results in $240,000 per year of lost revenue to OPALCO. The savings on our BPA power bill realized by reducing our peak loads will help us reduce our revenue loss, but it will be minor. Now the quandary - we promised to pass on the BPA rate decrease to you. If we pay incentives to those of you who sign up for load management, the lost revenue has to come from somewhere. Of course, we could raise rates, but that seems foolish when we are looking at decreasing rates. As I see it, there are two options: (1) use part of the 6% rate decrease for these incentives (2% or 3%, for example) or (2) reduce our rates by the full 6% and go forward with the Load Management Program, realizing that we will probably raise rates by 2 or 3% a year or two down the road. What does it mean in dollars and cents? The average OPALCO member uses 1,000 kWh per month - obviously more in the winter and less in the summer. Here is what the average bill would look like: an electric bill which now costs $77.99 would be $73.31 with a 6% decrease, $74.87 with a 4% decrease and $69.87 for those who sign up for load management (4% decrease plus 6% incentives). The actual amount of savings would depend on what load management options you select. Now the question: do you want a 6% across the board rate decrease or a smaller decrease and cash incentives for load management? Would we get 4,000 people to sign up if we did not offer incentives? Call, write, stop us on the street or whatever it takes, but please let us know what you would prefer.
Doug Bechtel
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