Sunday, July 14, 2024

Chelan PUD commissioners update crypto, data center rates

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Chelan PUD commissioners unanimously approved rate changes for crypto miners and data center customers Monday, August 21. Effective February 2024, rate 36 customers will pay a cost-of-production energy charge until collectively, they reach 10 megawatts (MW). Cryptocurrency and data centers currently use about 9 megawatts with another half megawatt anticipated later this year. When their collective energy needs exceed 10 MW, the rate will reflect a market energy charge.

The new rate structure also includes several requirements intended to address the risks of these uses, and to protect residential rates and other rate classes from the associated impacts. The changes include:

- A size limit of 3 MW per service point for rate 35 and 36 customers.

- Data centers are included in rate 36.

- Limits on where new services can be located to preserve the capacity and operability of substations and distribution equipment.

- Interruptability. For example, if there’s an outage or some other issue with the electrical grid, Chelan PUD would prioritize continued service to other customer classes first.

- Security deposit up to 3 months of the estimated bill. Rate 35 and 36 customers will also continue to pay an upfront capital charge.

“These proposed changes represent a fair shake,” said Commissioner Steve McKenna. “We’re offering a rate structure that doesn’t shut out small operations, with safeguards to prevent this type of customer from impacting everyone else served by Chelan PUD.”

Rates 35 and 36 were adopted in 2016 and 2018.

Low water year offset by strong energy prices

In other news, commissioners heard updates on Chelan PUD’s budget and energy trading that show Chelan PUD’s financials are holding steady, even during a low-water year. According to the Northwest River Forecast Center, the January through July water supply forecast for the Columbia River at Grand Coulee ended up at 76% of normal. Low-water conditions mean hydropower generation at Rock Island and Rocky Reach dams are down, resulting in wholesale revenues about $36.8 million less than budgeted.

However, revenues from long-term slice contracts are up thanks to higher wholesale market pricing. Those factors combined, energy-related revenue is projected to be $4 million better than budget. Overall, Chelan PUD’s bottom line is forecasted to be $119 million for 2023, about $16 million better than budget.

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