April 13, 2006 By STEVE KADEL  H&N Staff Writer

Klamath Basin irrigators will pay higher power costs under an Oregon Public Utility Commission decision Wednesday.

The ruling goes into effect Sunday and covers 1,400 Klamath Reclamation Project irrigators and 700 off-Project irrigators. It's intended to put them on rates similar to other PacifiCorp irrigation customers after a seven-year phase-in.

Scott Seus, a California farmer and chairman of the Klamath Water Users Association's power committee, used a baseball analogy to describe the ruling.

“It's not a home run, but a double,” he said. “They recognize what we have advocated all along - that there is a credit for value. (Phase-in) allows people time to adjust their irrigation practices to stay in business.

“The commission came out somewhere in the middle. That's probably a reasonable approach. It gives us breathing room.”

The amount of cost increase varies among customer classes, but each now pays less than a penny per kilowatt hour while other PacifiCorp irrigation customers pay 6.98 cents, according to the utility commission.

Local irrigation officials see a bright spot in the ruling. That is the chance to receive rate credits if they can convince the commission of benefits the Project provides the hydroelectric system.

“We recirculate water and put in back into the system so it does not disappear,” said Steve Kandra, president of the Klamath Water Users Association. “The commission recognized the irrigating community has a valid assertion when we say we provide a benefit for the utility.”

Kandra said irrigators will submit more hydrological data to the commission in hopes of getting rate credits.

Under Wednesday's ruling, Project users will pay .82 cents per kilowatt hour during the first year of a seven-year phase-in. That's up from the current .60 cents per kilowatt hour.

Off-Project users' rates will increase from .75 cents to .99 cents per kilowatt hour in the rate increase's first year.

Oregon law requires the total rate boost to unfold over seven years to give irrigators time to adjust.

“We listened carefully to arguments, and I believe this is a fair and equitable path we've chosen,” commission chairman Lee Beyer said. “The phase-in will ease the transition to new rates while giving us additional time to thoroughly examine the option of rate credits.”

The phase-in will cause a revenue shortfall of about $1.7 million, which will be spread among PacifiCorp's other customers, according to the utility commission.

However, Bureau of Reclamation spokeswoman Rae Olsen of Klamath Falls said that agency “remains concerned that the increase in power rates will have a negative effect on small family irrigators.”

“For the past few years we've worked with PacifiCorp, irrigators and others to achieve a fair and equitable rate,” she said. “We will continue to work through the (Federal Energy Regulatory Commission) relicensing process to receive a fair rate.”