Nobody wants OPALCO bills to go up. But the new rates are the right decision.

Utilities recover costs from three rate components: facility, energy and demand charges. Each member pays the same facility charge, intended to cover costs to build, maintain and replace equipment such as cables. The energy and demand charges cover payments to BPA and your bill goes up with consumption.

In 2014 facilities represented 73 percent of OPALCO’s costs. But only 25 percent of OPALCO’s costs were collected from the facility charge. Instead OPALCO recovers most facility costs from the energy charge.

Electricity use is going down as homeowners install efficiency measures and solar panels. That is good for the environment. But OPALCO’s ability to collect revenues to maintain facilities is at risk when energy use falls. If the energy rate is raised to cover facility costs it may lead members to switch heating to propane, heating oil and wood. That increases greenhouse gases and further reduces revenues.

There is also an equity issue. Seasonal residents pay for energy use mostly when they are on island. But the cables are available year-round. Keeping facility costs in the Energy Charge shifts responsibility to year-round residents. We don’t pay property taxes for roads just when we are driving.

In 2015, OPALCO’s new rates will collect 33 percent of facility costs from this charge. By 2019 it may increase to 47 percent, still well under actual costs of 75 percent. The energy charge still sends a signal for efficiency investments with the new block 3 rate for large users.

I’m concerned about the impacts of increasing bills. The PAL program to assist low-income families is insufficient. We should be careful in trying to tune the rates to protect these families.

A low-energy consumer could be a wealthy household with a large investment in solar energy and efficiency. A more effective approach is to expand low-income assistance through OPALCO revenues devoted to home efficiency and rate relief.

The board has taken a thoughtful step in adjusting the charges and phasing in the change over five years to reduce rate shock.

Brian Silverstein

Lopez Island