Q. What is Avista requesting?
A. Avista filed a request with the Washington Utilities and Transportation Commission (commission) on Feb. 4, 2014, to increase electric and natural gas base rates, beginning Jan. 1, 2015. The main driver in filing the requests is the continuing need to expand and replace the facilities and equipment we use every day to serve you, our customer. All requests are subject to the commission’s review and approval.
The filing includes:
· a request for a 3.8 percent increase in base revenues for capital investments
· the expiration of two rebates customers are currently receiving that are reducing monthly electric bills by 2.8 percent
· the proposal of a new rebate that would reduce customer bills by 1.1 percent
· a request to increase the monthly basic charge from $8 to $15
These rebates are passed through to customers on a dollar-for-dollar basis and do not increase or decrease the company’s earnings.
The bill impact for a customer using an average of 965 kilowatt hours per month would be, if approved:
· A total billed increase of $4.89 per month or 6.1 percent
· A revised monthly bill of $84.98
The filing includes:
· a request for an increase in base revenues of 8.1 percent
· a request to increase the monthly basic charge from $8 to $12
The bill impact for a customer using an average of 65 therm per months would be, if approved:
· A total billed increase of $5.23 per month or 8.5 percent
· A revised monthly bill of $66.42
Q. Why is Avista requesting to increase rates?
A. The main driver in filing the requests is the continuing need to expand and replace the facilities and equipment we use every day to serve you, our customer. We expect capital investments of $335 million in 2014, up from $280 million in 2013. These investments include upgrades and maintenance of generation facilities, transmission and distribution equipment, natural gas pipe and information technology upgrades.
Q. When will my bill increase?
A. Avista has requested that new rates, if approved, take effect on Jan. 1, 2015.
Once a rate request is filed, the commission has up to 11 months to make a decision. During this time, the commission will review our costs, review relevant data and listen to public testimony. With this information, they will approve rates they feel are reasonable and fair.
Q. Who decides if and how much my bill will increase?
A. Avista is a regulated utility which means we cannot increase or decrease rates without approval by the commission. After reviewing Avista’s request and costs, relevant data and listening to the public, the commission will approve rates they believe are reasonable and fair to customers and Avista.
Q. Is executive pay included in my rates?
A. Yes. Salaries and bonuses of all officers are less than one-half of a penny of every dollar paid in rates. Rate dollars go toward many things that ensure you have the energy you need, including systems that allow us to generate and purchase as well as deliver energy to customers.
Q. What do our rates pay for?
A. Rates for electric and natural gas customers cover two types of costs:
1. the cost of generating or purchasing energy
2. the cost of delivering that energy to customers
The main drivers of this rate request are increased capital investments. These capital investments strengthen Avista’s ability to generate and deliver reliable energy to customers. Below are some capital projects that are included in the rate requests.
Post Falls South Channel Dam Project
Beginning spring 2014, Avista will upgrade the 106-year-old South Channel Dam, one of three dams that make up the Post Falls Hydroelectric Development. The project includes:
· replacing the original concrete on the structure that helps control water levels of Lake Coeur d’Alene and parts of the three rivers
· installing new electronic gates and hoists
· installing new electrical and controls to automate the opening and closing of the spillway gates, increasing efficiencies and reducing cost
This work will increase reliability and preserve the life of this important generation resource.
Nine Mile Powerhouse Project
We are in the midst of a multi-year project to rehabilitate the Nine Mile Powerhouse, also 106-years-old. The project will replace original generators, turbines and other equipment that will increase the generation of clean, renewable, low-cost power.
Customer Information System and Enterprise Asset Management System
Avista’s customer information system is the foundation of our day-to-day customer operations. For 20 years, the system has been meeting the needs of our customers and the company, but like pipe, wires and equipment, it needs to be replaced. The system touches all of our customers and supports traditional utility business functions, such as meter reading, customer billing, payment processing, credit, customer service orders and material management.
Natural Gas Pipe Replacement
Avista continues a major project to systematically replace portions of natural gas distribution pipe. The project is replacing hundreds of miles of natural gas pipeline that was installed prior to 1987.