A Stronger Foundation
Securing More Federal Hydropower for Umatilla Electric Members
As we recognize National Hydropower Day on Aug. 24, it’s a good opportunity to explain why federal hydropower is one of the most valuable resources serving UEC members, and why a recent power supply agreement represents an important long-term achievement for the cooperative.
Wholesale power supply has one of the largest impacts on Umatilla Electric Cooperative’s (UEC) electric rates. About 86 cents of every dollar UEC collects goes toward purchasing the electricity we deliver to our members. That is why the UEC team is heavily focused on negotiating the best possible agreements with our power supply providers, ensuring your power is as affordable as possible.
One of the most important parts of that strategy is hydropower. UEC purchases much of its electricity from the Bonneville Power Administration (BPA), the federal agency that markets power generated by the federal Columbia River Power System. Because BPA sells electricity at-cost, its power is typically among the lowest-cost and most reliable resources available in the Pacific Northwest.
Think of BPA’s federal hydropower system as the foundation of a house, everything else is built on it, and its stability is critical to the whole structure. It provides the stable base that supports the rest of UEC’s power supply portfolio.
However, BPA’s supply is limited. Each utility is given an allocated amount of the federal power resources for the life of their power supply contract with BPA.
UEC has worked with BPA for decades under long-term contracts that determine how much federal power each utility receives. The next contract, which takes effect in October 2028, has been under development for more than five years.
Under the current agreement, approximately 75% of the electricity serving UEC’s Legacy¹ members is supplied through BPA’s federal system. During negotiations for the new contract, one of UEC’s primary objectives was to increase that allocation.
Those efforts were successful.
Beginning in October 2028, BPA will provide enough federal hydropower to serve 100% of UEC’s Legacy¹ load, or all our existing members apart from large industrial members such as data centers.
That means a larger share of the electricity serving homes, farms, businesses, and traditional industries will come from one of the region’s lowest-cost and most stable power resources.
This change will not lower today’s electric bills (the new contract does not begin until 2028) but it strengthens UEC’s ability to manage future wholesale power costs. UEC was able to secure additional federal hydropower because of two key factors:
- First, the cooperative has experienced substantial load growth since BPA last established allocation levels.
- Second, UEC’s long-standing investment in energy efficiency helped position the cooperative for additional federal resources under BPA’s allocation methodology.
For years, UEC has partnered with homeowners, irrigators, commercial businesses, and industrial members to reduce energy use through efficiency programs and incentives. Those efforts have helped members lower their own energy consumption while also strengthening UEC’s position during BPA’s allocation process.
UEC is one of many BPA customers in the Northwest, and additional federal hydropower under the new contract was not a given. UEC’s allocation increased due to our proactive activities in energy conservation and UEC’s load growth since 2011.
Over the life of the new contract, the additional federal allocation is expected to reduce wholesale power costs by millions of dollars compared with purchasing a larger share of electricity on the open market.
Hydropower’s value extends beyond cost. It provides flexible, around-the-clock generation that helps maintain reliability across the Northwest electric grid. Decisions affecting how the federal hydropower system operates can influence both electricity costs and system reliability throughout the region.
For that reason, UEC works alongside other consumer-owned utilities to ensure cooperative members are represented in discussions about the future of the federal hydropower system.
The new BPA contract reflects years of planning and negotiation, but its impact will be felt well into the future. By increasing UEC’s access to low-cost federal hydropower, the agreement strengthens the cooperative’s long-term power supply strategy and helps position members for greater price stability in the years ahead.
¹Legacy members include all residential, commercial, agricultural, and industrial members other than data centers. Data centers receive power under separate power supply arrangements because of their unique size and energy requirements and are not included in BPA's federal allocation methodology.