July 30, 2014 in Idaho

Attorney general’s office urges lower Avista electric rates

By The Spokesman-Review
By the numbers

$1.69 Savings per month for Avista customers if state Utilities and Transportation Commission approves the attorney general’s proposal to lower electric rates

3.8 Requested percentage increase in electric rates by Avista

10.1 Percentage of profits for investors sought by Avista

8.75 to 9 Percentage of profits for Avista’s investors sought by state utilities staff and the attorney general

Avista Utilities should lower base rates for its Washington electric customers instead of trying to collect more money, the state attorney general’s office said this month.

The office, which described the utility’s latest rate request as “excessive,” is the second government entity to call for lower electric rates for the Spokane-based utility beginning Jan. 1. The state Utilities and Transportation Commission’s staff took a similar position last week.

Both parties cited changing business conditions, including Avista’s ability to borrow money at more favorable interest rates for capital projects to upgrade aging dams and replace other equipment.

The parties also support smaller profits for Avista’s shareholders. They’re recommending profits in the 8.75 percent to 9 percent range, while Avista is seeking profit levels of 10.1 percent for its investors.

Avista’s 241,000 Washington electric customers would see a small savings on their bills next winter, if either recommendation is adopted by the three-member utilities commission, which has the final say on rates. A decision is expected in December.

Under the utility commission’s staff recommendation, the savings would be about $1.69 per month, or 1.7 percent, for an average household’s electric bill. The AG’s Office of Public Counsel wants to cut Avista’s electric revenues by 5.4 percent, but the office hasn’t calculated how that would affect monthly bills, said Lisa Gafken, assistant attorney general.

Avista officials, meanwhile, are asking for a 3.8 percent increase in electrical rates. In an earlier filing, company officials said they expect to spend $335 million on capital projects this year, including upgrades at century-old dams on the Spokane River.

Avista spokeswoman Casey Fielder said company officials will review the recommendations to cut electric rates. The company has until Aug. 22 to file a response with the commission.

Both the UTC staff and the AG’s office support an increase in Avista’s base natural gas rates next year, but they said it should be about half of the 8.1 percent increase requested by the company.

Washington regulators will take comment from Avista’s electric customers during two public hearings: at 6 p.m. on Aug. 26 in the Spokane City Council chambers, and at noon on Aug. 27 in the Spokane Valley City Council chambers.

In related news, Avista’s North Idaho customers have until Aug. 15 to send in comments or request a public hearing for a proposed settlement that would freeze base electric and gas rates until at least Jan. 1, 2016. 

Comments or requests for a hearing can be submitted at www.puc.idaho.gov. Click on “Case Comment Form” and enter the case number (AVU-E-14-05 or AVU-G-14-01) and provide your comments. They can also be mailed to P.O. Box 83720, Boise, ID, 83720-0074. 

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