Electric rates in Ashland will go up by 5.3 percent on Jan. 1, costing the typical residential customer another $3.45 each month.
The Ashland City Council unanimously but reluctantly approved the increase Tuesday night.
Earlier this year, the council approved a 12.7 percent water-bill hike and 10 percent sewer-rate increase.
Increase typical customer will see after Jan. 1
"It is frustrating," Councilor Greg Lemhouse said. "We seem to be chasing our tails with water rates and electricity rates."
Ashland is faced with rising wholesale power and electricity transmission charges from the Bonneville Power Administration. The Ashland Electric Department is further burdened because it must shoulder a share of the Ashland Fiber Network's debt burden, City Administrator Dave Kanner said.
Launched in the late 1990s to provide high-speed Internet and cable-television service, AFN sank $15.5 million into debt before stemming the financial bleeding by selling off its money-losing cable-television side.
AFN still sells high-speed Internet service and is able to make part of its debt payments.
Ashland addresses the rest of the debt with property taxes, reduced spending for other city departments, and asking other departments to contribute toward the debt.
Despite the challenges for the Electric Department and the coming rate increase in January, Ashland residents still will pay less for electricity than people in other communities who rely on Pacific Power.
A typical residential Pacific Power bill is $80.67 per month, compared with $65.24 per month for an Ashland customer who uses the same amount of electricity, according to data collected by city staff.
The typical residential bill in Ashland will go up to $68.69 per month in January, according to the data.
Ashland could face a greater escalation of electricity rates in the future if it can't improve on its already strong track record of electricity conservation.
BPA sets electricity-use benchmarks for communities, and if communities go over those benchmarks, they must pay 35 percent more for the so-called "tier-two power" they use.
BPA projects that Ashland will need to begin buying that higher-cost, tier-two power in 2015, city officials said.
Staff reporter Vickie Aldous can be reached at 541-479-8199 or firstname.lastname@example.org.