Throughout 2009 we’ve been talking a lot about natural gas rate reductions in Washington and for good reason; we’ve lowered gas rates in Washington and Idaho three times this year for a total reduction in each state of around 30%.
But any request – up or down – has to be approved by a state commission. It takes up to 11 months for the Washington Utilities and Transportation Commission (WUTC) to review and reach a decision in a general rate request.
This brings us to next week – Dec. 23 to be exact. Way back on Jan. 23, 2009, we filed an electric and natural gas general rate increase request with the WUTC. If you do the math, 11 months puts a ruling due by Dec. 23. The ruling could come anytime between now and next Wednesday.
Since the ruling hasn’t been issued, we don’t know what the exact numbers will be, but the partial settlement agreement we reached in September was for about a 3% increase in electric prices; that’s down significantly from the amount we originally requested in our January filing. A lot changed in the 11 months since the original filing with the WUTC, especially with steep declines in wholesale natural gas prices. That’s why we reduced the amount in our partial settlement agreement.
One of the most confusing things I’ve encountered working in the utility industry is rate making. It’s a long, rather complicated process that is at times difficult to follow. Sometimes it seems that every mention of a rate case, such as in public hearings, filed testimony before the commissions, mailed brochures and media articles – all sound like separate rate increases. Yet, each event is all a part of the public, transparent rate-making process; one that you’ve been able to participate in all year long.
Utilities like Avista must file rate cases to recover costs, which are explicitly detailed in rates filings. The commission makes the final decisions about what is fair and reasonable for you and for Avista.
Again, we don’t yet know what the rates impact will be on this general rate case, but we do know it will be issued on or before Dec. 23. So please don’t be shocked if you hear about a rate decision – it’s the same rate case we’ve been talking about all year finally coming to a conclusion.