||| FROM KRISTA BOUCHEY for ORCAS POWER & LIGHT COOPERATIVE |||
The 2026 OPALCO annual budget was approved at the November 20 board meeting including changes to the rate structure and a ~6% rate increase for residential members. This works out to an increase of approximately $12/month for the average San Juan County residence. The budget forecasts 5% rate increases for each of the next five years to keep up with inflation, the rising costs of power and labor, and to manage the Co-op’s equity position. The Co-op uses equity to borrow federal funds to build essential capital projects, like the multiple submarine cable replacements that are scheduled over the next 10-20 years.
The OPALCO team did an extensive analysis of the OPALCO rate structure during 2025. Members will see some changes in the way their bills are allocated in 2026 due to findings of the rate study. Here is a summary of the rate changes:
- Shifting How Costs Are Shared: Most of OPALCO’s revenue comes from the per-kWh charge.
Our cost-of-service study showed it’s fairer to spread more costs into the fixed monthly charge
(Service Access Charge). This means an increase in the monthly service charge but a lower per-
kWh charge. - Updating Commercial Members Cost Allocation: The cost-of-service study also found that
commercial members were subsidizing residential members (by approx. 1%) For 2026, the
residential rates will be increased more than the commercial rates. - Stability in Energy Costs: Instead of being tied only to power costs, the “energy charge
adjustment” will reflect OPALCO’s overall operating margin. - Peak Demand Information: Bills will include a new line showing your highest energy use in the
month (your “peak demand”). For now, this is just information—no extra charges will be added
in 2026. - Fees for Larger Services: Most homes won’t see a change, but if you have a larger-than-
standard meter, there will be a small monthly fee ($10 for 400-amp service, $20 for 600-amp or
more).
What does this mean for your bills?
- For residential members, you will likely see a 5.8% rate increase for your overall monthly
bill with the increase higher in your service access charge ($67.58/month) than kWh charge
($0.1395 per kWh). - For commercial members, your increase will be less this year depending on if you are large
commercial (no notable increase) or small commercial (2.4% increase).
All expense categories are rising. This is driving higher power bills for OPALCO members for 2026 and into the foreseeable future. OPALCO will continue to encourage members to utilize our on-bill financing program, Switch It Up, to encourage beneficial electrification and energy conservation which will help members save money on their rising bills and save energy for the planet.
OPALCO is committed to programs that help its most vulnerable members keep up with the rising cost of power. The 2026 Budget increases the Energy Assist bill credit amounts to offset the rate increase.
Additionally, OPALCO will continue to support and promote Project Pal for households who struggle to pay their power bills, which is a one-time grant each year during heating season. Apply for or learn more about energy assistance online.
OPALCO’s final tariff structure for 2026 will have its second read and be approved at the December 2025 Board Meeting. For the full 2026 budget report or the 2025 cost-of-service study, visit the Document Library on OPALCO’s website at www.opalco.com. If you have questions about these changes, the OPALCO team is hosting a virtual meeting on the topic on December 15 th @ 5 pm via Zoom. Email us for more information (communications@opalco.com), or visit www.opalco.com/events
Orcas Power & Light Cooperative (OPALCO) is our member-owned cooperative electric utility, serving more than 11,000 members on 20 islands in San Juan County. OPALCO provides electricity that is 95% greenhouse-gas free and is generated predominantly by hydroelectric plants. OPALCO was founded in 1937.
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The Social Security cost-of-living adjustment for 2026 is 2.8%, for context.
The proposed new OPALCO increases, falling mostly on residential users:
“ For residential members, you will likely see a 5.8% rate increase ”
“ For commercial members, your increase will be less this year depending on if you are large
commercial (no notable increase) or small commercial (2.4% increase).”
To put things into a longer-term perspective, the projected 5% increases over the next five years would amount to a 44% increase over a seven-year period beginning in 2024. By comparison, seven years of inflationary increases at 3% per year would amount to a 31% increase over the same period. Some of this is surely unavoidable, due in part to massive data centers putting unrealizable demands on BPA power supplies, as I have written in the SEATTLE TIMES, republished in The Orcasonian (and Orcas Currents) as:
https://theorcasonian.com/the-ai-power-struggle-data-centers-are-in-a-desperate-search-for-energy/
But part of it, I’m sure, is due to internal OPALCO expenses — including the six-figure annual salaries being paid several executives.
Some belt-tightening seems in order here.
5.8% may seem like a lot but this is consistent with what’s happening at the state and national level, and we’re actually coming out a bit better despite the overall higher costs of island life.
A recent analysis titled “How Rising Utility Costs Are Overwhelming American Families” found that from March 2022 to June 2025, monthly energy costs nationwide increased by about 35%, which is 3X inflation.
EIA.gov (“U.S. electricity prices continue steady increase”, May 2015) states that “Retail electricity prices have increased faster than the rate of inflation since 2022, and we expect them to continue increasing through 2026.”
Closer to home, PSE (Puget Sound Energy) expects a 9.3% increase (“Washington Utility Rate Increases Coming in 2026”).
That said, I don’t disagree with Mr. Riordan’s comments regarding a need for OPALCO to tighten their belt wherever possible.
Individuals should also do everything they can to tighten their own belts. For a start, don’t leave your Christmas lights on 24/7 through next February like some of my neighbors have in recent years!
Michael Riordan
Related to your article and the data center energy issue. Is there a petition circulated which suggests that corporate interests be required to develop solutions to create power for AI?
I’d sign something like that. And perhaps many in our community would as well.
Considering the massive market cap and valuations regarding some of these corporations: Microsoft, Google, Amazon, Open AI, etc.
This appears to me another case of Corporate Welfare that is negatively impacting the well being of our communities. Unfortunately, our political process frequently supports Corporate interests perhaps before the people, since these organizations support political campaigns and influence politics as well.
For those who live with a modest footprint, we are getting to the point where it makes sense to ditch OPALCO in favor of solar, wood heat, and propane. It does not quite pencil out yet, but has other intrinsic benefits, considering you gain independence from this organization. I guess you lose access to the glossy monthly magazine though, so no chickpea fritter recipe.
Hi, OPALCO–
I just looked through your materials on the 2026 budget – https://www.opalco.com/wp-content/uploads/2025/11/00-2026-Budget-Report-Packet.pdf – and I seem to have missed the 2026 tariff paid to rooftop residential solar producers. What is that new number for 2026? And is it the same number paid to commercial accounts with rooftop solar?
Thank you–