Deal Escalates Utility Turf War Agreement Would Allow Wwp To Match Prices Offered By Inland Power In Two Areas

A turf war between two utilities serving Spokane escalated Thursday with the disclosure of a proposed electricity rate settlement.

Terms, if approved by Washington regulators, will allow Washington Water Power Co. to match prices offered largely to commercial customers by Inland Power & Light Co. where utility distribution lines overlap.

Inland has underbid WWP for new accounts because, as a member-owned cooperative, its board of directors sets the rates without review by the Washington Utilities and Transportation Commission.

WWP rates are subject to commission approval.

Last fall, WWP asked the commission for the flexibility to set rates within a band. At the high end of the range were existing rates, at the low end rates that would enable WWP to match what Inland was offering.

The change would apply in only two areas - the Spokane Valley and West Plains - not allocated to either utility under a 25-year-old agreement intended to avoid expensive duplication of distribution lines.

But the commission shelved the proposal because, according to the staff, it discriminated against WWP customers in the contested areas who have no access to other electricity providers.

In a settlement signed late Wednesday, WWP agreed to make the banded rates available to any customer within the two disputed service territories.

Rates Manager Tom Dukich said WWP could land as much as $1 million in business from new customers, who would help cover the utility’s fixed costs.

If there are any revenue losses, he added, those would be absorbed by WWP.

The agreement with the commission staff, the Industrial Customers of Northwest Utilities and Public Counsel, which represents consumers, has still not been submitted to the commissioners themselves, Dukich noted. The commission is expected to receive the settlement proposal within the next 10 days.

At Inland, assistant General Manager Dave Clinton said he was surprised that WWP and commission staff would negotiate a deal that will create two classes of commercial customers.

Those within the contested areas get a rate break, he said, while those who must buy service from WWP do not.

“WWP has broken a long-standing precedent,” Clinton said, noting the potential difference in rates could be as much as 23 percent.

He added that WWP has been extending its lines into territory traditionally served by Inland as the larger, private utility follows population growth into expanding suburban areas.

Despite the dispute, Clinton said, Inland is committed to talks scheduled to begin soon that will attempt to sort out the competing territorial claims.

“This won’t change that,” he said.

, DataTimes