An old treaty with Canada costs Tacoma Power customers money. It’s time for a new deal.

By Chris Robinson and Scott Simms

Originally published in The News Tribune, Sept. 29

The Columbia River Treaty was created 58 years ago to ensure the mutual development of the Columbia River for flood control and related coordinated power systems in the U.S. and Canada. But it’s time to revisit the provisions of the treaty, which cost Tacoma Power and other Northwest utility customers more for their electricity.

The current treaty includes a provision called the “Canadian Entitlement,” which was designed to pay for the construction of Canada’s dams by transferring clean, affordable hydropower produced in the Northwest to Canada. The same power is then sold back to Northwest utilities, including Tacoma Power, at premium prices during times of peak energy use. The Canadian Entitlement is based on 1960s-era calculations, and its value fluctuates based on the price of electricity in the wholesale market. This results in Pacific Northwest electric customers overpaying Canada by $150 million or much more per year, and Tacoma Power customers represent at least $5M of that figure. In simpler terms, it’s equivalent to operating a large hydroelectric dam strictly for Canada’s benefit.

Things are different in 2022 than they were in 1964, and this is particularly true of the energy demands both in the Tacoma Power service area and the Northwest in general. The value of renewable hydropower has increased significantly, and the demand for clean energy resources to power our local economy continues to rise as we electrify our vehicles, ships and more.

Our region is also experiencing more extreme weather than it did in 1964, and customers in other parts of the Northwest could be one heatwave or cold snap away from power disruptions due to regional energy shortfalls. The current treaty complicates the Northwest’s response to extreme weather and drives up power costs region-wide and for Tacoma Power customers.

Records from the original negotiation suggest the intent of the treaty was to have an equal sharing of the hydropower benefits between the U.S. and Canada, but the implementation of the treaty has not played out that way for the U.S. or for Tacoma Power’s customers. Right now, there is an opportunity to correct those provisions and modernize the Columbia River Treaty to meet our region’s current needs.

When it comes to climate resilience, transportation electrification or creating the jobs of the future, costs matter— particularly for our low-income customers. Customers need to be able to charge their electric vehicles no matter where they live or work, and the bottom line is that the treaty makes electrification more costly, with disparate impacts on less affluent communities.

Tacoma Power is focusing on equitably expanding electrification opportunities and using the clean, renewable hydroelectric energy generated here in Washington state to grow the local economy and reduce emissions. The multi-family housing and public charging program at Tacoma Power has seen significant customer interest, and more can be done in this area. Modernizing the Columbia River Treaty will help ensure that Tacoma Power can offer affordable electric vehicle charging programs to all customers, including historically under-invested communities.

Local utilities, elected leaders and the Northwest’s Congressional delegation have partnered in a strong, sustained and bipartisan effort to advocate that the Biden Administration’s State Department prioritize the negotiation of a modernized Columbia River Treaty — an updated treaty that balances flood risk management and ecosystem function while keeping the benefits of the Northwest’s clean, renewable hydropower in the U.S.

Let’s not let another year go by without ensuring that the benefits of our region’s clean energy stay where they are produced and prevent unnecessary costs for power customers in the Northwest — including right here in the South Sound.

Chris Robinson became general manager and superintendent of Tacoma Power in 2015 after serving as manager of Power Management and assistant power section manager of Energy Resource Planning.

Scott Simms joined the Public Power Council as the Executive Director in the summer of 2019. He provides strategic leadership for the collective interests of the region’s consumer-owned utilities that are preference customers of the Bonneville Power Administration.

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