The Chelan-Douglas Regional Port Authority and other tax-dependent entities in Douglas County are pressuring Douglas County PUD to charge Microsoft and other data center customers less than it would cost to provide the electric services they want.
They are doing this for the promise of increased property tax revenue as these entities develop their properties. The Port Authority claims homeowners might see a decrease in property taxes. When the first big data center started in 2008 my property tax stabilized temporarily, then continued to increase.
As sophisticated developers, Microsoft should have secured a contract for electricity, the primary input into their operation, as a first step. They didn’t. They bought land and excited people with stories about the value of the proposed operation. Then, I believe they started backing away from the original proposal, pointing the finger at Douglas PUD. They were probably pretty sure local officials would pressure Douglas PUD for a better deal.
Microsoft says Douglas PUD’s proposed transmission service price is too high, describing “modest costs or the minimal risks the utility will incur.” The proposed load is 180 megawatts! The current average load for Douglas PUD is about 140 megawatts. Doubling the load for a small utility impacts the whole electric system and introduces significant opportunity for increased costs and risk. Risks need to be borne by these large, well-financed customers, not by the utility and its existing customers. Imagine their reaction if the initial price is set too low and then needs to be increased!
Some entity representatives try to single out PUD commissioners in private meetings to encourage them to accept the risk of charging less than the PUD’s best cost estimate.
Meanwhile, Douglas PUD proceeds in good faith with engineering and procurement of equipment to meet the new customer’s needs.
I am proud of the Douglas PUD Commission for dealing with these customers as a board of commissioners should, in open public meetings. The Commission began a public process on Jan. 25, 2021. There are two more meetings for public input on April 6 and 7 and written input is usually appreciated.
Bill Dobbins is an East Wenatchee resident and was general manager of the Douglas County PUD for 21 years, retiring in 2017.