Utility Seeks ‘Exit Fee’ To Keep Rates Low Idaho Legislature Not Likely To Back Industry Deregulation

Idaho Power Co. wants the state to protect its low electricity rates by imposing fees on large users that seek to take their business to some other utility.

The “exit fee” proposal hinges on whether state legislators decide to deregulate the electrical industry and let customers shop around for the best bargains.

“You can’t simply let the large users escape the costs they have been paying for and everybody else has been paying for,” Idaho Power lobbyist Larry Taylor said Wednesday.

Taylor said Idaho Power is in no hurry to deregulate, and he senses lawmakers are reluctant to attempt any such change during this winter’s legislative session.

Large businesses in Idaho that use a lot of energy are lobbying heavily for deregulation as a way to save substantially on their electricity bills. But some lawmakers fear competition would increase rates to the detriment of the state’s economy as a whole, which depends on cheap hydroelectric power for farming and other industries.

“I don’t see the public clamoring for deregulation,” said House Republican Floor Leader Bruce Newcomb, a Burley farmer.

A recent U.S. Department of Energy study indicated that while some other states would see cheaper power bills, retail prices for electricity could rise by one-fourth to one-third in the Pacific Northwest, including Idaho.

Taylor said he expects resistance from businesses, who may consider the exit fee a way of discouraging them from searching for cheaper rates. And the proposal is getting mixed reviews from some legislators and user groups.

Exit fees probably would help irrigators, who rely heavily on electricity to pump water for crops, said Sherl Chapman, a lobbyist for the Idaho Water Users Association.