(The Center Square)- Rising utility costs will likely mean that customers of Seattle City Light customers should expect back-to-back 9.5% annual rate hikes over the next two years.
The rate hikes, which would start in 2027, are related to a backlog of infrastructure projects and rising electrical demand, according to a presentation by the city-owned utility to the City Council’s Seattle Parks and City Light Committee on Wednesday.
The rate increase would have to be passed by the Seattle City Council.
The presentation shows that an average residential customer could pay $10 more per month, or $120 more per year, over two years.
Seattle City Light estimates that by 2045, it will need more than 3,500 new megawatts of power, double what it uses today.
Without the increase, the utility said it would be unable to meet energy demand on more than 200 days a year by 2045.
New power will also be costly because it will have to come from solar, wind, or other alternative sources. Washington State law bars new power being put online from less costly fossil fuels.
Back in March, the utility entered into a $1.5 billion settlement with three Native tribes, allowing Seattle City Light to continue using hydroelectric dams on the Skagit River to supply electricity to Seattle customers.
Planned rate hikes disclosed in the agreement between the tribes and the city-owned utility were calculated at 0.5% per year from 2027 to 2032.
But in a March interview with The Center Square, Chris Townsend, director of natural resources and hydro-licensing for Seattle City Light, said the rate increase did not account for the full costs that will need to be passed on to customers.
He said that only design work is included in the rates for a $979 million agreement reached with the tribes to trap and haul salmon using specialized vehicles around the three dams.
Townsend said construction costs for the salmon bypass project will be another factor impacting rates.
“More rate increases will be needed,” he said without providing specific numbers.
Seattle City Light implemented a 5.6% rate increase for customers in January of this year.