Friday, November 7, 2025
WENATCHEE — Chelan County PUD is proposing a 2026 budget that keeps the utility’s financial footing solid while easing off the throttle from the record-high years of wholesale power revenue. The draft plan shows a $128 million bottom line, roughly $29 million below the 2025 budget, and reflects what staff call a “right-sized” approach to spending and investment.
PUD's Manager of Strategic Financial Planning, David Nelson, told commissioners Monday the slimmer number isn’t a cutback but a return to normal hydropower markets. “We’re forecasting a strong bottom line for 2026,” Nelson said. “It’s still very strong. We’ve just seen lower forecasted prices and some increased expenses, so this is the realistic picture for the next five years.”
Local utility services — electric, water, wastewater and wholesale fiber — make up about one-fifth of Chelan PUD’s total revenue. The bulk still comes from surplus-power sales, which are projected to drop roughly 9 percent in 2026 as market prices ease.
The budget calls for a 3 percent rate increase next year to keep pace with inflation and modest growth in service demand. Nelson said electric load is expected to rise about 0.6 percent, with water and wastewater climbing slightly faster.
Operating costs overall are projected to increase about 9 percent, driven by essential maintenance and reliability work. Major projects include $11.9 million for spillway modernization and repairs at Rock Island Dam, $4.4 million for vegetation management and line-clearing, and $9 million to continue hatchery operations and maintenance.
Capital projects for 2026 focus on grid capacity and fire resiliency as Chelan County’s population and power use continue to grow. Highlights include construction of the Bavarian Substation in Leavenworth and Bridge Street Substation in Wenatchee, along with a major rebuild of the transmission line serving the Lake Wenatchee and Plain areas. Modernization work at both Rock Island Dam powerhouses will extend the lifespan of the generating units.
Nelson said the capital budget is about $47 million lower than 2025, not because projects are being shelved, but because staff budgeted to actual delivery capacity. Commissioners said that long-standing mismatch between projected and completed work has finally been corrected.
“This is a really good budget,” said Commissioner Garry Arseneault. “It reflects what we can truly achieve and doesn’t push staff to chase numbers we haven’t hit in ten years.”
Chelan PUD’s debt ratio is projected at about 8.7 percent for 2026, one of the lowest in the nation for a public utility of its size.
“In the ten years I’ve been a commissioner, I don’t know anywhere else in the country you see a utility with a debt ratio that low,” said Arseneault. “That gives me a lot of confidence in this budget.”
The proposal also clarifies how the district accounts for its Public Power Benefit program — about $6 million that funds community amenities such as fiber-network expansion and trail projects. Instead of listing it as a single expense line, the 2026 budget will show those dollars where they actually land, whether in operations or capital improvements.
Commissioners will hold a second public hearing Nov. 17, with final adoption set for Dec. 1. The full draft budget is available at chelanpud.org, and the full presentation delivered by Nelson on November 3 is available as a PDF here.
Andrew Simpson: 509-433-7626 or andrew@ward.media
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