http://www.heraldandnews.com/articles/2005/08/17/news/top_stories/top4.txt

Power rate talks to go until April

August 17, 2005

Klamath Basin irrigators have another seven months to haggle with PacifiCorp over power rates.

The parties involved with talks about a potential rate increase agreed last week to keep the discussion going until April, when a 50-year contract between the power company and irrigators is set to expire, according to the Oregon Public Utility Commission.

In June, the PUC had said the issue would be settled by Sept. 12, rather than waiting until spring.

The decision to keep the talks going until April comes after legislation by Oregon lawmakers that would phase in PacifiCorp's proposed tenfold increase over seven years, rather than allow it to happen at once.

A 50-year-old contract made by PacifiCorp's predecessor - the California Oregon Power Co., or Copco - has kept rates at about half a cent per kilowatt hour for irrigators in and around the Klamath Reclamation Project. The contract expires April 16.

PacifiCorp has argued that the contract shouldn't be renewed, and the irrigators' rate should increased to what other irrigators pay around Oregon.

Irrigators argue that the company and its customers benefit from the Project's existence.

"We still strongly feel that customers throughout the PacifiCorp ratepayer area benefit from the water we provide the Klamath hydroelectrical project," said Scott Seus, chairman of the Klamath Water Users Association's power committee.

He said the PUC's decision to continue discussion shows that officials think there is no need to rush to judgment.

"We certainly agree to that," he said.

The discussion is mostly between the irrigators and PacifiCorp, and is taking place in hearings before the PUC and through correspondence.

The decision to extend talks until April came during an e-mail discussion about the issue among parties involved, said PUC spokesman Bob Valdez.

The PUC is weighing two issues: Whether rates for irrigators should go up as much as tenfold, and whether PacifiCorp should be able to raise rates 12 percent statewide.

PUC officials had said in June that the two issues would be decided at the same time, with the decision to come out by Sept. 12. But now the Klamath issue will wait until the spring, while the general rate hike will be decided by Oct. 4.

"That way there will be a way to incorporate the current legislation," Valdez said.

Many of the issues concerning the proposed rate increase are still up in the air, said Jon Coney, PacifiCorp spokesman. The legislation means that a rate increase would come slower than company officials had planned if approved.

"It's just sort of a change in mechanics," he said.