Warm Winter Weather Elsewhere Can Affect Electricity Prices Here in Seattle

While the Pacific Northwest is experiencing cold temperatures and mountains are covered with snow, unusually warm conditions in other parts of the country are holding down prices on the surplus electricity Seattle City Light sells to other utilities.

Recent freezing temperatures and even some snow flurries in Seattle defied a broader national trend of warmer winter weather.

Meteorologists announced earlier this month that 2012 was the warmest year on record in the United States and that trend is continuing this winter, particularly in the East. Seattle was one of the few cities to record average annual temperatures last year.

Such unusually warm conditions in other areas of the country do have an impact on Seattle City Light. The warmer winter weather means less demand for natural gas for heating. Lower demand means lower natural gas prices, which electricity prices tend to follow.

Seattle City Light sells electricity its customers don’t need to other utilities in the wholesale market. Revenue from these surplus energy sales helps to keep our customers’ rates among the lowest in the country.  How much City Light makes depends on prices and our supply of power, 90 percent of which comes from hydroelectric dams.

 

Photo of Boundary Dam in winter.

Boundary Dam

While there is a long way to go before the end of winter, snowpack in the watersheds that feed Seattle City Light’s Skagit Hydroelectric Project is above normal. Snowpack for Boundary Dam is below normal, but in combination with it’s share of Bonneville Power Administration’s Columbia River hydro generation, the utility expects to have a solid supply of water with which to make electricity. If wholesale energy prices stay low as expected, however, City Light would not benefit as much from the surplus power it can generate.

Taking a broader view, the warmer temperatures create another concern from hydroelectric utilities like City Light.

Warmer winters in the Pacific Northwest would mean more of our precipitation falling as rain and smaller snowpacks in the mountains. Shrinking glaciers in the North Cascades where the Skagit River headwaters are provide some indication that this is already happening.

City Light’s hydroelectric dams depend on snowpack to store much of that water well into the spring, when rising temperatures gradually melt the snow. They simply do not have enough storage capacity to hold a year’s worth of water all at once. Without the snowpack helping to store the water supply, the dams can’t make sufficient electricity later in the year.

That’s why Seattle City Light supports efforts to address climate change. In 2005, City Light became the first large electric utility in the country to become greenhouse gas neutral by offsetting all the carbon emissions from our operations. We’ve continued that achievement every year since and remain the only large American electric utility to do so.

City Light also supports state and federal legislation that would encourage reductions in greenhouse gas emissions.

We support the state and region’s efforts to increase new, renewable power sources and to pursue all reasonable energy conservation efforts. City Light customers annually demonstrate leadership in energy conservation and the utility has already contracted for enough new renewable energy to meet the law’s escalating goals through 2019.

City Light is involved in climate change issues because the utility and our customers depend on winter snow to keep the lights on.  You can do your part – and save some money along the way – by taking steps to reduce your energy consumption: use energy efficient light bulbs and appliances; program your thermostat to reduce heating when you’re not using it; and eliminate energy vampires that use energy even when the device is turned off.

You can find additional tips along with discounts and rebates on our energy conservation web page at http://seattle.gov/light/conserve/ .