A delicate equation

Potential energy cost savings for Portland State from a public buyout of Portland General Electric could be overshadowed by rising fuel costs, according to PSU officials.

Potential buyers, including the city of Portland and the state of Oregon, have touted rate decreases associated with public ownership. But PGE says savings may just minimize rate increases, and officials at Portland State say any rate changes, due to a buyout or not, will take a year to appear on residential students’ bills.

College Housing Northwest has factored a hefty utility rate increase into next year’s rent.

“We’re anticipating next year that rates are going up 18 percent, so we definitely take that into account,” said Joe Vennes, administration manager at College Housing Northwest.

Students living in college housing have utilities included in their rent, with the exception of West Hall residents. Because rental rates are changed once a year, students are insulated from utility rate changes until the university adjusts the rents in the spring.

Currently, utilities make up about 15 percent of student housing rent, Vennes said.

According to Cassandra Hill, an accountant in business affairs, this means that the university picks up the tab when there are unanticipated rate changes.

“The university would be biting the bullet if the bill goes in excess of what [students] pay for it. It doesn’t really affect the year it’s happening,” Hill said. “They set those rates and if utilities are less than what we predicted, the university takes that loss.”

“We don’t go in midyear and change rent,” said Cathy Dyck, interim vice president for finance and administration.

Rates change differently for on-campus students than for regular residential users.

No matter what happens with PGE ownership or the economy, the Public Utilities Commission has to approve a rate change.

“Any kind of decrease or increase, whatever the case may be, will have to be approved by PUC,” Dyck said.

An additional increase in rates seems probable.

“With oil being so expensive and water levels down this year, all those things can contribute to a rate increase,” Dyck said.

Scott Simms, public information officer at PGE, said that whatever savings a public buyout may produce are overshadowed by market pressures such as the rising cost of oil and increased competition for coal and natural gas.

“We’re pretty certain that in this environment, it’s difficult for anybody to be providing rate decreases,” he said. “There are a lot of non-political but very real drivers of energy costs.”