WUTC: State approves rate increases for Avista’s electric and natural gas customers

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State approves rate increases for Avista’s electric and natural gas customers

FOR IMMEDIATE RELEASE
Dec. 29, 2008
Media Contact: (360) 664-1116
Docket: UE-080416, UG-080417

OLYMPIA, Wash. - The Washington Utilities and Transportation Commission (UTC) today approved a settlement agreement that will allow Avista to raise rates to collect an additional $37.3 million in electric and natural gas revenues, 14 percent less than the $43.2 million originally requested by the company in March. New rates go into effect Jan. 1.

Electric rates will increase 9.1 percent and natural gas rates will increase 2.4 percent. An average residential electric customer using 1000 kilowatt-hours a month will pay an additional $2.90 a month for a total of $73.72. The typical natural gas customer using 70 therms a month will see an increase of about $2.18 to $87.33 a month.

In their written decision, the commissioners stated that the increase “proposed in the settlement balances investor and consumer interests and results in rates that provide Avista with the financial ability to provide safe and reliable utility service to consumers at reasonable rates.”

The commission also approved an increase of $500,000 in funding for payment assistance programs benefiting Avista’s low-income customers, bringing funding up to $2.9 million for low-income electric customers and $1.6 million for low-income gas customers. Funding for the low-income energy efficiency and conservation program also was increased by $350,000, up to about $1.5 million.

In approving the settlement, the commission allowed Avista the opportunity to earn a 10.2 percent rate of return on equity, retaining the current authorized level.

Avista sought the rate hike to pay for rising costs for fuel, materials, supplies and labor, as well as environmental compliance and litigation costs related to hydroelectric resources, which are generally low-cost resources for producing electricity.

Avista filed the settlement agreement Sept. 16. Other parties to the settlement include the Northwest Industrial Gas Users, the Energy Project and the commission staff, who operate independently of the commissioners in litigated rate cases. Public Counsel Section of the Office of the Attorney General (Public Council) opposed the settlement. Industrial Customers of Northwest Utilities supported portions of the settlement, but joined Public Counsel in opposing other parts of the settlement.

The UTC is the state agency that regulates private, investor-owned electric and natural gas utilities in Washington. It is the commission’s responsibility to ensure regulated companies provide safe and reliable service to customers at reasonable rates, while allowing them the opportunity to earn a fair profit.

Spokane-based Avista serves 231,432 electric customers and 144,152 natural gas customers, primarily in Eastern Washington.

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Editor’s note: A copy of the order is available on the UTC Web site: www.utc.wa.gov/080416.

Staff contact: Amanda Murdock
Posted/updated: 04/16/2009


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