WENATCHEE — Columbia River flows at Rocky Reach Dam hit record-breaking lows in September and October, contributing to already sobering revenue expectations for the Chelan County PUD.

An average flow of 52,900 cubic feet per second in September easily broke the previous low record of 59,000 cfs set in 1994, commissioners learned Monday.

October set another record low — 57,800 cfs, compared to the previous record of 58,400 set in 2001, according to PUD records.

August’s average flow of 73,800 was the fourth lowest in the last 39 years.

“We just had a really dry, hot summer,” Janet Jaspers, the utility’s energy planning and trading manager, told commissioners.

National Weather Service statistics show that mean temperatures in June through September were an average of 3.2 percent warmer than monthly averages over the last 29 years.

The “mean” is the average of the month’s highest and lowest temperatures.

The hot, dry summer and low flows have worsened already low expectations for power generation this year.

Jaspers said that surplus power generated at Rocky Reach, Rock Island and Lake Chelan dams is expected to total 640,000 megawatt hours, 61 percent of the budgeted 1.1 million megawatt hours.

Low-water years typically mean higher market prices for surplus, but the recession has kept prices low, PUD statistics show.

Jaspers said market power was selling for $32 per megawatt hour Monday, down from the $51 per megawatt hour budgeted.

“This year is an anomaly year,” Jaspers said.

The double whammy of low prices and low flows have the PUD facing a bottom-line shortfall of between $19 million and $21 million this year, John Janney, the utility’s chief financial and risk officer told commissioners.

The loss comes despite a scramble to trim $27 million from capital and operations-and-maintenance costs and impose a temporary, 9 percent rate hike, called a “surcharge.” The surcharge will be in effect through April.

The trimmed capital budget of $80.3 million appears on track to end the year with about $6 million to spare.

Cash reserves are expected to total $224 million by year’s end, down from $256 million last year.

Reserves remain well above the lowest minimum of $130 million approved by commissioners, but Janney said at least $200 million in cash would be a more “prudent” reserve level, given the new short-term debt the utility issued following the Wall Street crash.

Early this year the PUD issued $172 million in short-term debt. The new note and bonds must be paid or refinanced in 2013 and 2014.

Janney said the generally uncertain banking environment and this year’s string of bank failures is also cause for increased reserves.

“There are some things that could happen that could cause us to have to come up with cash on short notice,” he said.

Included in that scenario could be another temporary surcharge next year to bolster reserves, he said. Another surcharge isn’t currently expected.

Utility officials say the 2010 budget will also be austere, with drier-than-normal conditions already in the early forecast for this winter. Commissioners will vote on the budget in December.

Christine Pratt: 665-1173

pratt@wenatcheeworld.com