Why Your Electricity Bills will be Going Up (A Lot!)

On June 30, the Seattle Times ran a story, “Why Do Seattle-Area Electricity Rates Keep Rising?” The author, Renata Geraldo, quoted officials of the four largest electric utilities around here — Puget Sound Energy, Snohomish PUD, and the Tacoma and Seattle municipal systems — about their various reasons. In the midst of the story was the cautious statement, “The ongoing push for green energy and higher demand might lead to a continued increase in rates.”

It’s more than “might.” It will increase rates, and the faster the goal of a carbon-neutral economy is pursued, the more rates will go up.

How urgent that goal is, and the best way to pursue it, are separate questions. But for Seattle City Light — and this story is about City Light — the pursuit of carbon neutrality has a clear consequence. It means electric rates will be going up over the next few decades, and probably not by a small amount.

The question is not whether City Light itself is a carbon-neutral utility. It already is, and has been so for nearly 20 years. It gets 86 percent of its energy from hydro, about half of that from its three dams on the Skagit River, and the rest from the Bonneville Power Administration. It gets another 5 percent each from wind and nuclear.

The question is about the larger goal of a carbon-neutral economy. That means getting people in Seattle to use electricity rather than gasoline, diesel and natural gas in their work, homes and vehicles. And that’s a much bigger task than one organization greening itself.

“Are we ready?” asks Emeka Anyanwu, City Light’s energy innovation and resources officer. “We don’t’ get to decide whether we want to be ready. The choice we get to make is what role are we willing to play.”

Anyanwu, who came to Seattle after a career at Kansas City Power & Light, is City Light’s futures man — “the utility’s chief troublemaker,” he says, with a chuckle. Behind his vision of the future is a study done for City Light by the Electric Power Research Institute and published in January 2022 as Seattle City Light Electrification Assessment. It outlines three scenarios for Seattle’s electric future. They are:

The current trends scenario

From 2020, in which 2 percent of the cars in the city were plug-in electrics, the percentage of electrics increases to 11 percent in 2030. Of transit and school buses, by 2030 6-7 percent are electrics, and of medium-haul trucks, 3-4 percent are electrics. Under this scenario, City Light’s overall electric load rises from 9.15 to 10.78 terawatts over the decade, up 18 percent. (A terawatt is one trillion watts.)

The progressive scenario

Following the city’s Climate Action Plan and other progressive goals, 30 percent of the cars, 82 percent of the transit and school buses and 27 to 30 percent of medium-haul trucks are electric by 2030. City Light’s electric load rises from 9.15 to 12.67 terawatts over the decade, up 38 percent.

The fully electrified economy

In this scenario, 100 percent of cars in the city are battery electric by 2030. This means that in Seattle, vehicles will be using 90 times more electricity than they used in 2020. Under this scenario, City Light’s total electric load rises from 9.15 terawatts to 18.65 percent, up 104 percent.

When Anyanwu spoke as City Light’s representative at a Bonneville Power Administration hearing in March, it was this third scenario, the fully electrified economy, that he outlined. The 2022 study says the fully electrified economy is “unlikely to occur without significant intervention” from City Light and government. That’s an understatement. “Significant” implies much more than adding 45 cents to the price of a gallon of gasoline, which Gov. Jay Inslee’s “cap and invest” program has done this year. The study warns, “Achieving high levels of electrification will be extremely difficult.”

We are already a third of the way through the decade. Though some strides are being made — the state, for example, has committed to converting the Puget Sound ferry fleet to battery power — the fully electrified economy is not happening by 2030. The trend is in that direction, though, and it remains the ultimate goal City Light is planning for.

“It’s a benchmark,” says Anyanwu. “We now foresee how energy use will change.”

The change involves more than cars. Most of it involves replacing natural gas in stoves, water heaters and especially, the heating of homes and businesses. Right now, roughly half the homes in Seattle are heated by natural gas.

Swapping gas furnaces for heat pumps implies many millions in spending by businesses and households. Mandates in new construction are one thing, but the replacement of existing equipment will be done when people choose to do it. The aggressive scenarios (two and three) imply that people will voluntarily tear out gas stoves, gas water heaters and gas furnaces — as well as junking their gasoline and diesel cars and trucks — when the equipment is still good.

In Seattle, some people are doing that now. You can see the Teslas in the streets and the ads on television for electric Volkswagens and Audis — and for installing solar panels. A neighbor of mine who has solar panels on his roof boasts that it has cut his City Light bill to a fraction, and that when he has excess power, he sells it back. Promoters imagine whole neighborhoods wired up this way, so that City Light gets the extra power it needs from the resources of the people right here.

The small-scale solar solution has an obvious attraction, but Anyanwu is wary of overselling it. Seattle’s electric future needs to be “inclusive and equitable,” he says. Not everyone in the city can afford to rip out their gas furnace and install solar panels on their roof or put in electric-vehicle charging units where they park. And remember, 55 percent of people in Seattle are renters, so these decisions are not up to them.

People do decide what cars they own. According to state figures, in King County there are now 29.5 electric cars for every 1,000 persons. That’s the second-highest rate among Washington’s 39 counties (after San Juan), and one of the fastest rates of adoption in the United States. ChargePoint, a California company that owns vehicle charging stations, ranks the Seattle metropolitan area as No. 2 in density of electric vehicles after the San Francisco Bay area.

But not everyone can afford an electric car, whether new or used. City Light’s study said that 17 percent of new cars sold in King County in 2022 were electrics. Judging from the ads on television, EVs are a hot product, but dealerships are still selling lots of gasoline-powered cars. The average gasoline-powered car lasts for 12 years — which implies that City Light has longer than the next seven years to bring on an all-electric future.

The forecast of a steeply increasing demand for power comes after a long period of relative stability. In the coming decades, City Light will at least partly return to the position it was in a century ago. Between 1910 and 1930, when Seattle people were buying their first electric stoves and water heaters, City Light’s electric load doubled every five and a half years. Under the utility’s pioneering leader, J.D. Ross, it responded by building three dams on the Skagit River — Gorge, Diablo, and Ross. These brought Seattle its famously cheap power rates.

Nobody is building big new dams today. In this state, environmentalists and the tribes are pushing to rip out the Lower Monumental, Ice Harbor, Little Goose, and Lower Granite dams on the lower Snake River, in order to help restore salmon runs. I asked Anyanwu about that. Given that Seattle City Light forecasts a doubling in electricity demand, wouldn’t it oppose the breaching of the dams?

“That’s not a decision for City Light to make,” he says, noting that the Snake River dams are under the purview of Congress, which has not been eager to destroy federal assets. (Notably, Sen. Maria Cantwell has held back.) Anyanwu adds, “Any decision that is taken around the future of the dams needs to be grounded in an understanding of how we can ensure the [power] resources are available.”

And what would those resources be? Nuclear is carbon-free, but it has been anathema here since the disasters at Three Mile Island and Chernobyl, and the financial meltdown of the Washington Public Power Supply System (WPPSS). That may be changing. A Maryland company called X-Energy has just reached a deal with Energy Northwest (the successor to WPPSS) to build next-generation modular reactors at Hanford. Bill Gates has backed a local company, TerraPower, which has a similar plan in Wyoming.

The green-electricity future has been pictured as solar and wind. Not long ago, these had to be steeply subsidized, but in recent years they have become more competitive. A federal study issued in 2021 says that from 2010 to 2020, the cost of utility-scale photovoltaic solar fell from about $2.50 a watt to about a dollar.

Large-scale wind and solar also requires the building of battery or pumped-water storage, so that people won’t suffer blackouts when the wind stops blowing or the sun goes down. A wind-and-solar future also requires time-of-use pricing, so that people will have an incentive to recharge their cars and run their dishwashers at times of low use, probably at night.

Large-scale solar and wind generation needs to be sited where sun and wind are strong, and where land is cheap — which means not around Western Washington. Wherever located, solar and wind farms and battery and pumped-storage installations will face opponents — tribes, environmental groups, neighbors, etc. Public projects in today’s world are also subject to what Ezra Klein of the New York Times calls “everything-bagel liberalism” — the piling-on of requirements for builders to use local union labor and disadvantaged contractors, to pay for environmental mitigation, and so on.

All of which implies that new “green” power, whether solar, wind or nuclear, will not be cheap. City Light will have to pay market prices for its new power and require its customers to pay for it. The utility will retain its ace in the hole — its Skagit dams and its public-preference contract with the Bonneville Power Administration. Because of those, says Anyanwu, “We have a good opportunity not to be wholly subject to market forces alone.”

In that respect, City Light will have an easier time than Bellevue-based Puget Sound Energy, which gets about half its power from coal and natural gas. In the electrified economy, rates will be going up for everyone.