Press Release WUTC 8/17/08

STATE OF WASHINGTON

WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION

1300 S. Evergreen Park Dr. S.W., P.O. Box 47250 â— Olympia, Washington 98504-7250

(360) 664-1160 â— TTY (360) 586-8203

Aug. 17, 2009

Media Contact: (360) 664-1116

Docket Number: UE-090134 & UG-090135

Editor’s note: This news release reflects the position of staff of the Washington Utilities and Transportation Commission (UTC) and NOT the views of the three-member commission. It discusses a staff recommendation that the commissioners have not yet reviewed. Any positions taken or comments offered by the commission staff regarding this proceeding should be attributed clearly to staff members and NOT to the UTC.

State utility staff recommend much lower rate increase for Avista customers

UTC invites public to two meetings next month in Spokane

Olympia, Wash. – Staff members of the Washington Utilities and Transportation Commission

(UTC) recommended a much lower rate increase for Avista’s electric and natural gas customers than the company originally requested.

The three-member UTC, which is not bound by the staff recommendation, will make a final decision on Avista’s rate-increase request by Dec. 23. New rates are expected to take effect Jan. 1.

In written testimony filed with the UTC, commission staff members said the company should be allowed a slight increase in electric revenues to 5.15 percent, or $20.1 million a year. UTC staff is advising Avista’s natural-gas rates should go up .13 percent, which is $280,000 a year increase in the company’s annual revenues. In January, Avista asked the commission to collect additional revenues of $69.8 million for electric service and $4.9 million natural gas revenues.

Commission staff is also suggesting the basic service charge for electric customers should increase 25 cents to $6 a month. In addition, staff members are proposing an $8 monthly customer service charge for natural gas customers next year up from the current $5.75. This is due to the staff recommendation to abolish the decoupling mechanism, a plan which removes the link between utility revenues and consumption.

Under the UTC’s staff recommendation, the average residential electric customer using 1000 kilowatt hours-a-month would see an increase of $3.55, for a proposed $80.80 total bill. If approved, the average natural-gas customer using 70 therms a month would pay about 13 cents more, for a revised $79.57 total bill.

Commission staff also is recommending Avista be allowed the opportunity to earn 10 percent rate of return on equity, not the 11 percent the company is requesting.

In addition to the UTC staff and the company, there are five other parties in the case who filed testimony today. Each party represents a different Avista ratepayer group: residential customers, conservation promoters, large electricity and natural gas users’ groups, businesses and low-income customers.

Avista customers will be able to comment to state regulators on the proposed utility rate increase at two meetings on the same day next month in Spokane. The first meeting is scheduled at 12:30 p.m. Wednesday, Sept. 30 in the Council Chambers, City of Spokane Valley, Redwood Plaza, 11707 E. Sprague Ave. The second meeting will be held at 5:30 p.m., Sept. 30 in the Council Chambers, City of Spokane, Lower Level of City Hall, 808 W. Spokane Falls Blvd.

The commission has received 696 public comments to date on Avista’s rate increase proposal – 689 opposing, five supporting and two undecided. Customers who are unable to attend the public meeting but wish to comment on the proposed rate hike can mail their correspondence to: P.O. Box 47250 Olympia, Wash. 98504, e-mail comments@utc.wa.gov or call toll-free 1-888-333-9882.

Spokane-based Avista serves more than 231,000 electric customers and about 146,000 natural gas customers, primarily in Eastern Washington.

The UTC is the state agency that regulates private, investor-owned electric and natural gas utilities in Washington. It is the commission’s responsibility to ensure regulated companies provide safe and reliable service to customers at reasonable rates, while allowing them the opportunity to earn a fair profit.

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Utilities and Transportation Commission, 1300 S Evergreen Park Dr SW, Olympia, WA 98504 United States