Homeowners in Eastern Washington could pay Avista Corp. an extra $6.53 a month for electricity next year, if state regulators approve a proposed rate increase.
The utility sent the requested 9.2 percent increase, which would bring a typical homeowner’s electric bill to $77.29, to the Washington Utilities and Transportation Commission on Tuesday.
Avista is also asking for a 3.3 percent increase in natural gas rates. If that’s approved, natural gas bills would rise $2.84 a month to $87.99 for a typical household.
The commission usually takes 10 to 11 months to act on rate increase requests, said Kelly Norwood, Avista’s vice president for state and federal regulation. So if the higher rates are approved, they would go into effect in early 2009.
Avista plans to file rate increase requests with the Idaho Public Utilities Commission in April.
The higher rates in Washington would generate an additional $43.2 million annually for Avista. Company officials said the money would go toward a number of expensive projects, including the relicensing of five dams on the Spokane River. Avista hopes to renew licenses for the dams from the federal government by the end of year, which will include conditions that will increase the cost of producing power.
The higher rates would also pay for upgrades to the utility’s aging infrastructure.
Higher prices for concrete, steel, copper, aluminum and other materials have driven up the cost of replacing 50-year-old generators in hydropower dams, updating transmission lines and substations.
“We’ve been around for over 100 years, so there’s a need to invest in the system,” Norwood said, noting that some of Avista’s transmission lines were installed in the 1930s or earlier.
The upgrades are making Avista more energy efficient and helping the utility serve a growing customer base, but there are upfront costs, Norwood said.
On the natural gas side, the higher rates would pay for the expansion of the Jackson Prairie Natural Gas Storage Facility near Chehalis, Wash. Avista is a one-third owner of the facility.
Avista buys natural gas in the spring and summer months when gas prices are lower and stores it at the underground facility until higher-demand winter months, Norwood said. The storage site helps the utility manage its natural gas costs, he said.
The proposed rate increase also includes more money for energy assistance programs, said Avista spokeswoman Debbie Simock.
The proposal for higher rates comes at a time when many households are already struggling with higher heating bills. Spokane Neighborhood Action Programs has paid $3.1 million to help 6,250 low-income households pay their heating bills since October. The grants average $502 per household.
SNAP is processing energy-assistance applications from another 2,300 households, said Robin Waller, SNAP’s communications specialist.
“Any increase is difficult for a low-income person,” she said. Cold winter, escalating gasoline prices and rising food costs are squeezing many families, Waller said. “They’re making conscious decisions about whether they will turn their heat on.”