January 24, 2009 in Business

Avista seeks OK for higher rates

Average bills would go up $9 to $10 a month
By The Spokesman-Review
 

Avista Utilities asked Washington and Idaho regulators Friday to approve electricity and natural gas rate increases that would raise monthly bills an average $9 to $10 a month.

Utility officials said it needs the money to cover higher energy costs and upgrades to distribution systems relying in part on 70-year-old equipment.

The Washington Utility and Transportation Commission has 11 months to rule on the applications; the Idaho Public Utilities Commission has seven months.

If approved in full, Washington customers who use 1,000 kilowatt-hours a month in electricity would pay $82.93, up $6.99, or 9.2 percent. Natural gas bills, based on 70 therms of consumption a month, would climb 2.5 percent, or $2.11, to $87.51.

In Idaho, where consumers use an average 982 kilowatt-hours a month of electricity, bills would increase 7.8 percent to $85.18, up $6.71. Gas rates would increase $2.56 a month to $81.94 – a 3.2 percent bump – based on 66 therms of consumption.

The increases would yield a total $69.8 million in annual revenues to Avista.

Electricity rates for Avista’s 231,000 electricity customers went up 9 percent Dec. 28. Rates for its 121,000 Idaho electricity customers went up 12 percent Oct. 1.

Vice President Kelly Norwood said those increases reflected investment in system upgrades and expansion through 2008. That work must continue because of 2005 federal legislation that requires more reliability in the electricity grid, he said.

Higher prices for concrete, steel and copper have doubled construction costs, Norwood said, and ratepayers can no longer be shielded from those expenditures.

The company also continues to upgrade the turbines at its two Clark Fork River dams, Norwood said, and the proposed Washington increase would include $3.1 million in expenses related to the relicensing of Avista dams on the Spokane River.

He said Avista has leased the natural gas-fueled Lancaster Power Plant at Rathdrum to help replace 20 megawatts of cheap hydropower purchased from the Grant County Public Utility District since the 1950s. That contract expires this year.

To help limit expenses, the salaries of Avista executives were frozen for 2009, and plans to add space at the company’s Mission Street headquarters were shelved, Norwood noted, adding that the company does not earn as much on its investment as state regulators allow.

He encouraged customers to take advantage of Avista energy efficiency programs and comfort billing, which averages monthly charges, as well as energy assistance available through Spokane Neighborhood Action Programs.

Bert Caldwell can be reached at (509) 459-5450 or bertc@spokesman.com.


There is one comment on this story. Click here to view comment >>

Get stories like this in a free daily email