Chelan PUD holds public meeting in Leavenworth on proposed rate increase extension

LEAVENWORTH – Chelan County PUD is considering extending its current rate plan of three to four percent annual rate increases for an additional two years to address the rising cost of providing service. 

The rate plan started under the 2020-2024 strategic plan, with a four percent annual increase in water rates, a four percent annual increase in wastewater rates, and a three percent annual increase in electricity rates. If the extension were adopted, this rate schedule would continue in June 2025 and June 2026.

According to the PUD, under the two-year extension, average-use residential customers would see a $2 increase in their monthly electric bill, a $3 increase in their monthly water bill, and a $3.75 to $3.90 increase in their monthly wastewater bill each year. 

If adopted, the discount offered to low-income seniors and people with disabilities would also increase to between $11 and $13.50 a month, effective June 2025.

The incremental increase aims to lessen the gap between customer rates and service costs. According to the PUD, the cost to generate electricity increased from $100 per month per customer to $153 per month between 2018 and 2024, and the average customer bill rose from $55 to $66 per month. 

During an Aug. 27 public meeting in Leavenworth, the PUD stated that the average cost growth in all of its systems was about 6 percent a year. Common reasons for increased costs were inflation averaging 4.2 percent and negotiated labor cost increases averaging 5.4 percent a year since 2020, as well as non-payroll insurance increasing 35.5 percent in cost from 2023 to 2024, and post-pandemic supply chain cost increases, such as a distribution transformer tripling in cost. 

“We still need to buy the insurance, we still have to change power poles, and we still have to buy transformers, and costs still continue to escalate. So we're going to keep our cost as small as we can, but there are costs,” said PUD Commissioner Steve McKenna during the meeting.

Without the adoption of the extension, the PUD proposed that the widening gap would put more pressure and reliance on power sales, and customers would potentially see a larger rate increase in the future.

During the meeting, former Peshastin Water District (PWD) General Manager Steve Keene raised concerns about the extension affecting Peshastin area customers. The PUD acquired PWD earlier this year, establishing an agreement that PWD customers would pay a rate equalization charge of four percent increases annually for three years, such that revenues would be approximately equal to those forecast under previous PWD plans. 

The proposed extension would take the place of the rate equalization charge in 2025 and 2026 and defer it for two years. Meaning, the three-year agreement would conclude in 2028, rather than 2026. Concerned that the changes would draw out the original agreement, Keene requested that the three-year rate equalization charge either remain in place, or that the PUD eliminate the charge and Peshastin customers start paying standard PUD rates if and when the extension goes into effect.

“I have customers that have talked to me in Peshastin that are concerned that, well, once PUD takes over our water system, our rates are just going to go up. Well, that's not true. Our rates were going to go up anyway, but I'm seeing a gap there, and the perception of the customers is that we're getting screwed,” said Keene.

The Aug. 26 meeting in Leavenworth was one of three public meetings hosted by Chelan PUD in regard to the rate plan extension. PUD staff will provide a summary of public comment during a rate hearing at the Sept. 16 board of commissioners meeting. 

Written comments can be submitted by mail: P.O. Box 1231, Wenatchee, WA 98807, or by email: contactus@chelanpud.org. Comments should reference the subject as, “2025-2026 Rate Proposal Record Comments.”

Commissioners will consider a resolution to adopt the two-year extension on Oct. 7.

Taylor Caldwell: 509-433-7276 or taylor@ward.media