Proposal seeks to reduce Avista electric rate hike

The Idaho Public Utilities Commission will conduct a telephonic public hearing on Nov. 29 at 7 p.m. on a proposed settlement that would cut an Avista Utilities electric rate hike by more than half of what was proposed in May.

For the residential customer who uses the system's average of 918 kilowatts per hour, the rate increase would be $2.64 per month under the proposal. Before the proposed settlement, the increase request was $6.54 per month.

Those figures also reflect a proposed cut in the proposed increase to the residential basic charge, a fixed customer service charge that covers fixed costs not related to energy consumption such as billing and metering. The proposal reduces that charge from $6.25, which Avista originally requested, to $5.75. The current charge is $5.25 per month.

"Avista has signed the settlement so it has agreed to the conditions," said Gene Fadness, IPUC spokesman.

The proposed settlement reduces the rate increase for an average residential electric user from 6.3 percent to 2.6 percent.

Avista has asked for a Jan. 1 effective date with the new rates.

"The case was opened on May 26, and we typically like to have the process completed in six months," Fadness said.

If the settlement is approved, the average monthly electric bill would increase to $87.15.

The increase in electric revenue would allow Avista to recover costs primarily driven by the company's increased capital investments in infrastructure to serve customers, according to company officials.

"This settlement agreement will provide new electric rates in Idaho that are fair and reasonable for our customers, the company and our shareholders," said Dennis Vermillion, Avista Corp. senior vice president and president of Avista Utilities. "This outcome provides us the opportunity to continue to earn a fair return in Idaho and supports Avista's efforts to make key capital investments so we can continue to provide the reliable energy our customers expect."

People wishing to testify or listen in on the public hearing should call toll-free at (888) 706-6468 and enter a participant code of 4435939. Those wishing to testify should call between 6:45 p.m. and 7 p.m. to allow time for IPUC staff to take names.

When the hearing begins, people will be called on to testify in the order in which they phoned in. While people are welcome to listen to the entire hearing, they can speak only when called upon to testify.

The commission opted for a telephonic hearing rather than an on-site hearing to allow more participation at greater convenience. Such a hearing will provide a greater opportunity for customers in all of Avista’s Idaho territory from Grangeville north to Sandpoint to participate as opposed to hearings held in one or two cities.

However, if customers desire an on-site hearing, they can request one by writing the commission indicating their desire to attend such a hearing and explaining why a telephonic hearing is not sufficient.

Those who would like to provide input but who are unable to call in to the public hearing, can submit written comments via the commission’s website at www.puc.idaho.gov. Scroll to the Consumers tab, and then click on "Case Comment Form," and complete the form using the case number, AVU-E-16-03.

Comments can also be mailed to the commission at 472 W. Washington St., Boise, ID, 83702. The deadline for written comments, which carry the same weight as oral testimony, is Dec. 2.

The proposed settlement reduces Avista’s requested annual revenue increase by $9.2 million (from $15.4 million to $6.2 million).

The most significant adjustments were a $4.5 million reduction by moving Palouse wind project net expenses from base rates to the annual power cost adjustment process and a $2.47 million reduction in cost of capital.

Parties intervening in the case included commission staff, the Clearwater Paper Corporation, Idaho Forest Products, the Snake River Alliance and the Community Action Partnership Association of Idaho. The commission will also conduct a technical hearing for those parties on Dec. 2.

The parties also agreed to meet before the next rate case to assess Avista’s low-income weatherization and energy conservation education programs for possible improvements.

Avista serves about 125,000 customers in North Idaho.

A copy of the proposed settlement as well as other documents in the rate case are available on the IPUC website. Click on "Open Cases" under the "Electric" heading and scroll down to Case No. AVU-E-16-03.

Effective Nov. 1, Avista natural gas customers received a 7.8 percent decrease in their rates.

The average residential or small commercial customer will see a decrease of about $4.65 per month.

The decrease is primarily attributable to a reduction in natural gas commodity costs due to a warmer-than-normal 2015-16 winter, an abundance of natural gas in storage and continued high production levels of natural gas.