PORT TOWNSEND — Jefferson County Public Utility District commissioners could sign a “definitive agreement” with Puget Sound Energy executives Wednesday to make PSE’s electrical system in East Jefferson County public.
It would be the PUD’s next step in its new business venture to provide electricity to about 18,000 East Jefferson customers.
Puget Sound Energy executives have opted to respect voters’ wishes in a 2008 plebiscite and work cooperatively to sell its county interests to PUD after providing service for nearly a century.
“We want to get it signed before we file for [Bonneville Power Administration] power,” PUD Commissioner Barney Burke said Monday after addressing about 40 people attending a Jefferson County Chamber of Commerce luncheon at the Elks Lodge.
“This agreement spells out in more detail what is spelled out in the letter of intent.”
The PUD commissioners scheduled a 5 p.m. special meeting Wednesday in their conference room at the PUD offices, 230 Chimacum Road, Port Hadlock.
There they will discuss and possibly sign the agreement to purchase Puget Sound Energy’s facilities.
Burke, a former Port Townsend newspaper reporter finishing an appointed term left open with the death last November of PUD Commissioner Dana Roberts, was joined by PUD Commissioners Ken McMillen of Kala Point and Wayne King of Gardiner at Monday’s chamber luncheon.
Under the binding definitive agreement, the PUD would agree to pay Puget Sound Energy $103 million for its East Jefferson County facilities.
Pull out still possible
PUD can still pull out of the agreement if financing does not work out in a year, Burke said.
However, if both parties commit to all terms and one reneges on the deal after its effective date, it is agreed that a $2.5 million penalty would have to be paid to cover legal and other expenses.
Next, Burke said, a purchase power agreement for BPA discount rates comes once PUD meets BPA’s standards, which primarily involve showing how PUD can provide service.
Discount purchase
Once BPA power is secured, Burke said, the PUD can purchase it at a discount that will allow PUD to offer rates comparable to Puget Sound Energy to begin with and for less in the future.
Before Jefferson County Public Utility District can get into the power business, it must leap three hurdles.
It must reach final agreement to acquire Puget Sound Energy’s Jefferson County facilities, secure rural utility service financing through the U.S. Department of Agriculture and apply to BPA for discount power rates.
The PUD must apply to BPA by June 30 to secure 38 megawatts of 50 megawatts BPA is allocating to public agency applicants.
If the PUD misses the deadline, it cannot apply again until 2012.
To buy the federal BPA power, the PUD must show in its application that it is “an operating utility” and has the infrastructure to deliver power to customers.
PUD officials thanked those with Citizens for Local Power, the grass-roots group that successfully campaigned to get Proposition 1 on the 2008 ballot.
Bill Wise, co-facilitator with Citizens for Local Power, said the group still meets monthly to discuss issues the group campaigned for in 2008.
“We now are having a dialogue about our topics of interest,” Wise said.
Those issues include assistance for low-income power customers, energy conservation and renewable energy and how the community can step forward to pick up community contributions that will be lost once Puget Sound Energy ends its service in East Jefferson.
As a governmental entity, the PUD will not be allowed to make such donations.
PUD officials said they will be looking to interested parties such as Citizens for Local Power to act in an advisory capacity once such stakeholder committees are designated.
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Port Townsend-Jefferson County Editor Jeff Chew can be reached at 360-385-2335 or at jeff.chew@peninsuladailynews.com.