A conversation about our rates   

Tags: Avista Utilities, Answering Questions, Rates

Post by Dan Kolbet
 
I always enjoy customer comments on the blog, even if we don’t get flooded with them. I wanted to share this one from a customer named Vivian, who posted a comment on our announcement of a Washington electric rate decrease request in early January.

Vivian said: “Now, if this rate "decrease" is approved, will it be 7% off the new rate effective Jan 1st, just 43 days earlier, or will it be 7% off the old rate? It is very, very frustrating, to reduce our usage by 30 kwH/day, only to have our rates increased by 2.7%! This is on top of 3 increases for 2009. Gotta get it back some way, don't you? Frustrated, as I said.”

To which I replied: Vivian, I understand your frustration, we seem to have rate changes (up and down) a lot and it’s hard to keep track (even for me). To answer your question the requested 7% decrease in Washington would be based on the current rate being charged, which includes the increase in January. The timing isn’t very convenient, but it’s a decrease and it’s part of the regulatory process.

But the bottom line is this: This time last year a Wash. residential customer using 1000 kwh would be billed $75.94. Today its $77.14. If our decrease request is approved, the new rate would be $71.79 – down even from this time last year.

Since Avista is a regulated utility, we’re required to ask regulators for rate changes, up or down. It’s no surprise that people would rather see rates go down rather than up, but that’s challenging considering the increasing demand for energy. Sometimes we’re even required to request a rate change for various programs or adjustments based on regulatory requirements like the upcoming tariff filings in Washington and Idaho for energy efficiency programs. Sometimes the timing of rate filings is out of our control.

We’ve already stated publically that we anticipate filing a general rate case in Washington as early as the end of the first quarter 2010. General rate cases in Washington can take up to 11 months to come to resolution. (The length of a general rate case can be up to seven months in Idaho and 10 months in Oregon.)

So there is always some time in between the filing and the resolution, making both events seem independent, but they are really just bookends of the same public process. Unfortunately every filing, hearing, newspaper article, blog, TV interview or news release about a rate activity sounds like an increase and like Vivian said, that certainly can be frustrating.

So whether we’re requesting an increase or decrease; or whether it becomes effective in a few weeks or takes as much as 11 months – you’re probably like me – you want to know what impact any changes will have on your bill and there’s certainly nothing wrong with that. Since regulators set our rates, we don’t know the result of our request until the state commission makes a decision. On the blog, we’ll always give you the details when we file and when a ruling by the state commission is announced.

So, don’t be surprised when you see Avista filing some type of rate activity in the future, whether it be an increase or a decrease, it’s part of the regulatory process. If you want more details about any of this stuff, we’re always here to talk with you. You can follow our rates activities online and even here on the blog.
 
 
Posted by  System Account  on  2/11/2010
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