Settlement agreement reached in Washington general rate case   

Tags: Avista Utilities, Electricity, Natural Gas, Rates, Washington

Today, Avista announced that a full settlement agreement has been reached in Washington.

 

You may recall we filed a general rate request on Feb. 4, 2014 to increase electric and natural gas base rates in Washington that would support the ongoing need to expand and replace the facilities and equipment we use every day to serve our customers. Facilities like our 106-year-old South Channel Dam in Post Falls, Idaho and 106-year-old Powerhouse in Nine Mile, Washington. This settlement agreement would conclude the rate case and support these efforts.

 

This agreement has the full support of all parties involved in the rate case and is the result of these parties working together to agree on a settlement that is beneficial for our customers and our company.

 

What Does This Mean?

If approved, the proposed settlement agreement would increase electric and natural gas base rates as well as account for new and expiring rebates. Base rates are those that cover the total cost of providing electricity and natural gas service to customers. This includes generating and purchasing energy as well as the delivery of that energy to customers.

 

Here is what this looks like:

 

Item(s)

Details and Results

Base revenues

·         Increase electric by 1.4 percent or $7.0 million

·         Increase natural gas by 5.6 percent or $8.5 million

Expiring rebates

·         Electric customers are currently receiving benefits from two rebates that are reducing monthly energy bills by 2.8 percent during 2014.

·         These rebates will expire at the end of 2014.

New rebates

·         Avista would provide a rebate to customers of $8.6 million over 18 months related to its sale of renewable energy credits, which would partially replace the expiring rebates and reduce customers’ monthly bills by 1.2 percent.

Energy Recovery Mechanism (ERM)

·         A credit of $3.0 million from the existing ERM deferral balance would be returned to electric customers to offset the 2015 rate increase, which would reduce the overall electric billed rate increase from 1.4 percent to 0.8 percent.

LIRAP

·         Funding available for Avista’s Low Income Rate Assistance Program (LIRAP) would increase by $333,000 as a result of the settlement.

The overall change in customer billing rates from the settlement agreement, including the expiring and new rebates is 2.4 percent for electric customers and 5.5 percent for natural gas customers.

 

Residential Customer Bills Based on Average Usage

Electric – residential customer using an average 965 kilowatt hours per month

·         Total billed increase of $2.10 a month or 2.6 percent

·         A revised monthly bill of $82.19

·         An increase in the monthly basic charge from $8.00 to $8.50

 

Natural Gas - customer using an average of 65 therms per month

·         Increase of $3.62 a month or 5.9 percent

·         A revised monthly bill of $64.81

·         An increase in the monthly basic charge from $8.00 to $9.00

 

 

The bill increase for each customer group (e.g. residential, commercial) may differ due to adjustments to better reflect the cost to serve each customer group.

 

The settlement has been filed with and must be approved by the Washington Utilities and Transportation Commission (UTC or Commission).

 

For more details about the settlement, read the new release here.

 

Learn more about the rate-making process here. You can also watch this video and read this one-sheet.

 
Posted by  System Account  on  8/18/2014
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