SEQUIM — Utility customers in Clallam County Public Utility District 1 will see rate increases this spring following multi-year plans and increased costs for electricity, materials, infrastructure and staffing.
Sizable projects also are planned in the Sequim area along with continued planning for a new Port Angeles operations center, where a portion of the electricity rate increase will help with the project’s debt service.
Starting April 1, the new electric rate for the PUD’s nearly 37,000 metered customers will go up 3.75 percent. It will increase another 3.75 percent on April 1, 2027, following a two-year plan approved by the PUD’s board of commissioners last September.
According to a letter signed by commissioners and PUD General Manager Sean Worthington, the 3.75 percent increase includes 1.75 percent going to operations, 1 percent to the new warehouse’s debt service and 1 percent for capital project plans.
Staff said in November that the average customer using 1,300 kilowatt hours a month would see an average monthly increase of about $5.64.
New water and wastewater rates, now in the middle of a plan going through 2028, will go into effect on March 1. Water rates will increase by 4.75 percent for nearly 4,800 customers and 9 percent for about 90 wastewater customers.
Commissioners finalized the district’s 2026 budget on Nov. 10 after staff reported the Electric Cost of Service Analysis (COSA) at multiple board meetings in the fall.
The PUD’s outflow electric budget is about $96.8 million, its water outflow budget is about $12.4 million and the wastewater outflow budget is about $204,000.
Worthington wrote in an email that the district “works diligently to mitigate rate increases; however, we are not immune to cost escalation across multiple areas of operation,” including materials rising as much as 30 percent.
He said power procurement through the Bonneville Power Administration (BPA), which constitutes about 45 percent of the PUD’s electric utility’s costs, continues to increase.
According to the district’s budget packet, purchased power will go up by $1.8 million this year following BPA’s transmission rate increasing from 2026-28 by 19.9 percent and power rates by 6.5 percent while the PUD’s load levels have remained flat.
Worthington wrote that to reduce costs to consumers, staff members have emphasized cost control and long-term financial sustainability rather than short-term reductions.
“This includes disciplined budgeting, multi-year financial and capital planning, prioritization of projects based on safety, reliability and regulatory compliance, and ongoing review of operating expenses to identify efficiencies,” he wrote.
PUD staff also have “taken an aggressive posture toward pursuing grant funding, with an emphasis on four primary community impact areas — grid hardening and resiliency, highly impacted communities, system reliability and wildfire mitigation,” he said.
From 2023-25, the district has been awarded about $43 million in grant funding for projects that Worthington said would have been taken on by ratepayers.
“We are proud of the work being done in this area, and our employees remain dedicated to serving the customers of Clallam PUD responsibly and transparently,” he wrote.
Utility assistance
The PUD continues to offer a low-income energy assistance program with applications at https://www.clallampud.net/low-income-energy-assistance-program/. Call 360-452-9771 for assistance.
Staffing levels
According to the PUD’s budget book, personnel costs are projected to increase by 5 percent ($1.43 million) over 2025 staffing levels to slightly less than $30 million. The increases are attributed to rising insurance premiums and the district adding new positions, such as 10 summer interns and two student brush cutters. Staffing full-time equivalents (FTEs) will go from 170 to 180.
To offset some of the increased costs, administrators announced a reduction in Public Employees Retirement System (PERS) rates from 10 percent to 6 percent contributions, according to the budget book.
Capital projects
Worthington wrote that the PUD has significant planned investments in the Sequim area for both water and electric infrastructure in its 10-year planning horizon focused on maintaining reliability, addressing aging infrastructure and meeting regulatory requirements.
Assistant General Manager Shailesh Shere wrote in an email that last year the PUD received about $2.5 million for grid-hardening projects, $2.1 million for fire prevention projects, $2.1 million for underground projects and $2.6 million for utility pole management projects.
Shere wrote that they are prioritizing grant-funded projects to maximize reimbursement, such as replacing several end-of-life distribution poles and structures and underground infrastructure replacements.
Also of note, all scheduled transmission projects’ infrastructure is being upgraded to fiberglass construction to build wildfire resilience, he added.
Some of the capital projects in Sequim include:
• Diamond Point Undergrounding Phase II (budgeted cost $900,000).This is the second and final phase to place more than 6,000 feet of wire underground to eliminate tree-related outages, reduce wildfire risk and improve voltage and capacity along Diamond Point Road.
• Washington Street to Port Williams Transmission/Distribution Rebuild ($910,000). This project will replace 29 transmission and distribution poles and a few span guy poles from the intersection of North Brown Road and East Washington Street, weaving north along East Cedar Street to the old Sequim substation along an alley and going north to Port Williams Road and west to the Port Williams Road and North Sequim Avenue intersection.
• Gunstone Transmission ($270,000). Replace 30 transmission poles between Blyn substation and Discovery Bay.
• Breaker replacements in Sequim ($125,000). Substation breakers in Evergreen and Dungeness substations will be replaced.
As for the Port Angeles Operations Center, just less than $2.8 million has been budgeted for design scope.
In the letter from commissioners and Worthington, they wrote that it “isn’t just about a building. It’s about ensuring that your PUD has the tools, facilities and resiliency to serve you well, today and for the next 50-plus years.”
The building, constructed in the 1960s and on leased land, houses line crew, tree-trimming operations, an auto shop and facilities workers.
Commissioners wrote that the warehouse is outdated, undersized and ill-suited for modern demands of operating an electric and water utility. The PUD plans to build near its current building and Fairchild International Airport.
Worthington said they hope to start construction by the end of this year, but more than likely start next year and tentatively ready by the end of 2027. He said it was too soon for an exact budget, but staff estimated it to be between $30 million and $40 million.
________
Matthew Nash is a reporter with the Olympic Peninsula News Group, which is composed of Sound Publishing newspapers Peninsula Daily News, Sequim Gazette and Forks Forum. He can be reached by email at matthew.nash@sequimgazette.com.
