Avista Utilities will accept an Idaho electric hike that is nearly 60 percent lower than the company’s initial request in May, according to a settlement announced Monday.
Instead of getting $15.4 million in new electric revenues from higher base rates, the Spokane-based utility would receive $6.3 million.
The Idaho Public Utilities Commission must still act on the settlement. If it’s approved by the three-member commission, a typical household would see its bill increase by $2.64 per month for a total of $87.15. The new rates would take effect Jan. 1.
Part of the decrease relates to how Avista would recover $4.1 million in costs associated with the Palouse wind farm, said Casey Fielder, an Avista spokeswoman. Instead of recovering those costs through base rates, the utility would include them in yearly rate adjustments that track changes in the cost of electricity.
Avista also agreed to a lower return on equity of 9.5 percent, which is the amount that shareholders earn on common stock. The utility’s initial request had a 9.9 percent return on equity.
Parties involved in negotiating the settlement were Clearwater Paper Corp., Idaho Forest Group, Snake River Alliance, Community Action Partnership Association of Idaho and staff members from the Idaho Public Utilities Commission.
Avista has about 128,000 electric customers in Idaho.