Starting next month, Wyoming residents served by utilities that buy wholesale power from the Bonneville Power Administration (BPA) could see their electricity bills climb as the federal agency implements its first rate increase in six years.
"We have been holding our rates flat related to inflation for the last several rate periods," said Maryam Habibi, a BPA spokesperson. “We’ve had significant growth in our customers, so increased demand to integrate new generation.
"Those are really the main drivers leading to this first rate increase in, like, six years."
The average rate increase is 8.9% for BPA's tier one power rate, which represents most of the federal agency's power sales. Transmission rates are climbing even more steeply at 19.9% across the board.
In Wyoming, people in Jackson and Afton get their power from BPA, while it also sells wholesale to Rocky Mountain Power, which serves Casper, Douglas and most of southwest Wyoming.
Tiered System
BPA operates a two-tiered pricing system that treats public and private utilities differently.
"Beyond the amount of that first tier of power customer, the second tier is more expensive,” she said. "Most publics will have access to tier one. But private utilities will mostly be paying the tier two rate."
For 2025, with approximate tier one rates around $34.69 per megawatt-hour and tier two rates near $68/MWh, tier 2 rates are about 95% to 100% higher than tier one rates, according to the BPA.
This aligns with BPA's methodology where tier two rates cover the higher costs of acquiring additional power beyond the system's capability.
Take the example of Lower Valley Energy, which serves parts of western Wyoming from Afton and Jackson. It falls into the tier one category but still faces significant rate increases. The cooperative announced an average 7.9% retail rate increase effective in October.
"LVE's rate increase is all coming from BPA and mostly tier one market power, which is driven by market rates," said Brian Tanabe, Lower Valley Energy's spokesperson.
The utility is dealing with a 14% wholesale power cost increase from BPA, plus transmission cost increases.
Tanabe pointed to broader infrastructure challenges.
"On the transmission side, BPA has a $3 billion backlog of transmission projects,” he said.
Idaho Credit, Not For Wyoming
Rocky Mountain Power, which serves parts of Wyoming and Idaho, operates under a tier two arrangement with BPA and is part of what’s known as the Residential Exchange Program for Idaho, Washington and Oregon — but not Wyoming.
Rather than announcing rate increases, the utility recently touted credits for Idaho customers.
The Idaho Public Utilities Commission authorized Rocky Mountain Power to pass on a federal billing credit to certain residential and farm customers in Idaho.
The credit for Idaho RMP customers has increased from $7.93 million annually to $13.1 million annually.
The change to the authorized credit decreases the annual power bill of a typical residential customer by about $51.87 and takes effect beginning Oct. 1 through Sept. 30, 2028, according to the utility.
Habibi clarified that the residential exchange credits don't insulate utilities from the underlying wholesale rate increases.
"I assume that there would either be there would likely be an increase associated with Rocky Mountain Power as well," she said.
Rocky Mountain Power spokesperson David Eskelsen said BPA’s rate increases alone would not drive up power bills for Wyoming customers and that any future rate increase would be caused by a combination of factors.
Good News
According to the U.S. Energy Information Administration (EIA), Wyoming's electricity rates remain below the national average, around 12 cents per kilowatt-hour compared to about 16-17 cents nationally.
However, a May 2025 report from the University of Wyoming's Center for Energy Regulation and Policy cites EIA data showing Wyoming residential prices around 11.7 cents/kWh in early 2025 with an increase of about 2% year-over-year.
More positive news for residential customers: Lower Valley Energy announced Friday it will reduce natural gas rates by 5%, delivering savings to customers just as the heating season approaches.
The rate decrease amounts to about 7 cents per unit. The cooperative's board of directors approved the reduction as part of what the utility calls its "ongoing commitment to delivering the most affordable energy solutions to its member-owners."
The timing reflects the volatile nature of natural gas pricing.
"The natural gas rates, they're never stable," said John Burbridge, secretary and chief counsel for the Wyoming Public Utilities Commission.
Burbridge explained that gas utilities use regulatory mechanisms called "pass ons" that "prevents rate shock to the customers" by smoothing out price swings.
"That wholesale price goes up and down pretty wildly and so that just keeps them, the gas utilities on an even keel,” Burbridge told Cowboy State Daily. “It keeps the customers from experiencing really high rates and really low rates.”
David Madison can be reached at david@cowboystatedaily.com.
