Higher rates approved as Avista announces earnings

Starting Nov. 1, Avista’s Washington customers will pay about $4.50 extra on their combined monthly gas and electric bills. The price hike is a result of higher wholesale natural gas costs and a reduction in a federal credit for electricity rates. The Washington Utilities and Transportation recently approved Avista’s request to pass higher wholesale gas costs on to customers. Residential customers will pay about $3 extra on their monthly bills. Electric rates will increase by about $1.42 per month for residential customers. That increase results from a reduction in federal power benefits through the Bonneville Power Administration’s residential exchange program. The program spreads to Northwest ratepayers the economic benefits of federally operated dams on the Columbia and Snake rivers. In other news, Avista Corp. reported improved third-quarter earnings Thursday of $12.3 million, or 22 cents per share, compared with last year’s third-quarter earnings of $8.1 million, or 15 cents per share. Scott Morris, Avista’s Chairman and CEO, said the Spokane-based utility is on track to meet its earning projections for 2010. However, he also said the year-end earnings will be influenced by a “challenging first quarter due to one of the warmest January to March periods on record,” which reduced energy demand. For the nine month period ending Sept. 30, Avista’s net income was $66.7 million, or $1.20 per share, compared with $65 million, or $1.18 per share, for the same period last year. Morris said Avista is projecting higher earnings in 2011. Winter weather conditions are expected to return to normal, he said, and the utility is anticipating additional revenue from general rate increases. But the sluggish economy will continue to affect business growth and energy demand, he said. Idaho customers began paying higher electric and natural gas rates on Oct. 1, after the Idaho Public Utilities Commission approved Avista’s earlier request for a rate increase. In Washington, Avista has reached a settlement in a pending rate case. The utility is asking for new rates to take effect Dec. 1.