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FOR IMMEDIATE RELEASE
July 24, 2014
Public Counsel alleges Avista’s rate increase requests are excessive

Seeks to reject company’s request to increase customer charge from $8 to $15 per month for electric service and from $8 to $12 per month for natural gas service

SEATTLE — The Public Counsel Unit of the Washington State Attorney General’s Office has challenged electric and gas rate increases proposed by Avista Corp.

The Spokane-based utility is requesting that temporary rates that went into effect Jan.1, 2014 be made permanent. The temporary increase raised electric rates by $14 million and natural gas rates by $1.4 million.

Avista is requesting that rates be increased further to generate an additional $18.2 million in revenue from its electric customers and an additional $12.1 million in revenue from its natural gas customers.

The Washington Utilities and Transportation Commission (UTC) regulates the rates and services of Washington’s investor-owned utilities.

Avista last filed a general rate case in 2012. The UTC approved a settlement that provided for a two-step increase, with one rate increase going into effect on Jan. 1, 2013, and a second rate increase going into effect on Jan. 1, 2014. The UTC approved the two-step increase, but conditioned that the Jan. 1, 2014 rates would be temporary rates. 

Public Counsel filed expert testimony July 22, 2014 that analyzes a number of elements of Avista’s current proposal. Highlights of the Public Counsel submission include recommendations that the UTC:

  • Reject Avista’s “attrition” adjustment, which the company argues is designed to address regulatory lag in recovering the cost of new plant additions.  Public Counsel recommends that rates be calculated by updating actual costs to reflect the most recent data available.
  • Reject the company’s request to dramatically increase the customer charge from $8 to $15 per month for electric service and from $8 to $12 per month for natural gas service. Public Counsel recommends that the customer charge for electric service remain unchanged and that the customer charge for natural gas service be increased by a smaller amount.
  • Reduce Avista’s cost of equity to reflect the declining cost of capital.

If the UTC accepts Public Counsel’s adjustments, Avista’s electric rates would be reduced by approximately $26 million.  Avista’s natural gas rates would be increased by $4.7 million, which reduces Avista’s request by approximately $7 million.  Other parties, such as UTC staff, Industrial Customers of Northwest Utilities, Northwest Industrial Gas Users, or The Energy Project, may recommend additional reductions in other areas.

Avista will have an opportunity to file rebuttal testimony addressing Public Counsel and other parties’ recommendations. Hearings will be held in the fall, and a UTC decision is expected by Dec. 2014.

Avista serves approximately 241,000 electric customers and 152,000 natural gas customers in Eastern Washington.

PUBLIC COMMENT:
Members of the public can comment on the rate case in a number of ways.

The UTC will hold two public comment hearings:

  • Spokane:  Tuesday, Aug. 26, 2014, from 6:00 p.m. to 7:30 p.m., in the Spokane City Council Chambers, 808 W. Spokane Falls Boulevard, Spokane, Wash.  The UTC will begin taking comments from members of the public at 6:00 p.m., ending no later than 7:30 p.m.
  • Spokane Valley:  Wednesday, Aug. 27, 2014, from 12:00 p.m. (noon) to 1:30 p.m., in the Spokane Valley Council Chambers, 11707 E. Sprague Avenue, Spokane Valley, Wash.  The UTC will begin taking comments from members of the public at 12:00 p.m. (noon), ending no later than 1:30 p.m.

Written comments may be sent to UTC, P.O. Box 47250, Olympia, WA, 98504, or e-mail comments@utc.wa.gov. Include your name and mailing address, the name of the company (Avista), and docket no. UE 140188 / UG 140189 (electric and gas).

For more information, customers may contact either the UTC or Public Counsel:

  • UTC – (800) 562-6150, e-mail at comments@wutc.wa.gov. Information is available online at www.wutc.wa.gov. Enter docket no. UE 120436 (electric) or UG 120437 (natural gas).
  • Attorney General’s Office Public Counsel Section -- Public Counsel, Attorney General’s Office, 800 Fifth Avenue, Suite 2000, Seattle, WA 98104-3188, or e-mail utility@atg.wa.gov.

The Public Counsel Section advocates for the interests of consumers on major rate cases, mergers, rulemakings, and other proceedings before the UTC. More information about Public Counsel’s work is available online at http://www.atg.wa.gov/Utilities/AboutPublicCounsel.aspx.

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The Office of the Attorney General is the chief legal office for the state of Washington with attorneys and staff in 27 divisions across the state providing legal services to roughly 200 state agencies, boards and commissions. Attorney General Bob Ferguson is working hard to protect consumers and seniors against fraud, keep our communities safe, protect our environment and stand up for our veterans. Visit www.atg.wa.gov to learn more.

Contact:

Alison Dempsey-Hall, Acting Communications Director, (206) 442-4482

 

 

 

 

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