Avista requests electric and natural gas rate changes in Washington
“We’re making significant investments in our infrastructure and systems every year to maintain, upgrade and ensure the safety, reliability and resiliency of the equipment and facilities that serve our customers every day,”
“There are dozens of investments and projects that have been completed since the last rate case that are already serving customers but that are not included in the rates paid by customers. Additionally, Avista’s rates are cost-based, where the costs related to wood pole replacements, generator upgrades and other equipment that is included in customer rates reflects the cost of the equipment when it was installed, decades ago. The costs for this equipment are many times more expensive today, and this is a driver of our rate requests. These requests not only help to more closely align customer rates with Avista’s costs of providing service, they also support the opportunity to earn a fair return for our shareholders.
“While we make these investments for the benefit of our customers, we recognize that rate increases can be a hardship. As we make decisions about how and where to invest across the company, our customers are our primary focus. We take our responsibility to provide safe, reliable energy at an affordable price very seriously, and we work hard to manage our costs and identify ways to best serve our customers that contribute to keeping energy prices low,” Vermillion said.
Two-Year Rate Plan
The proposal is a two-year rate plan, with new rates taking effect
Avista’s Requests
General rate case
If approved, the electric general rate request is designed to increase annual billed revenues by
For natural gas, if approved, the general rate request is designed to increase annual billed revenues by
The electric and natural gas requests are based on a proposed rate of return (ROR) on rate base of 7.52 percent with a common equity ratio of 50 percent and a 9.9 percent return on equity (ROE).
Energy Recovery Mechanism Rebate
The general rate request is separate from the Energy Recovery Mechanism adjustment the company filed with the Commission on
Infrastructure Investments
Avista’s infrastructure investment plans address the need to replace infrastructure that has reached the end of its useful life, as well as respond to the need for reliability and technology investments required to build the integrated energy services grid that will take us into the future.
Among the projects in today’s filing are:
- The upgrade of generating units and other equipment that is over a century old at Avista’s
Little Falls Dam , which will provide more generating capacity to serve customers with reliable energy. - Our distribution grid modernization program that continuously rebuilds and upgrades every electric feeder in the system, replacing old equipment like poles, conductor, and transformers to improve service reliability, capture energy efficiency savings and improve operational ability.
- Ongoing management, inspection and replacement of 240,000 electric distribution wood poles through Avista’s wood pole management program, ensuring distribution wood poles and the equipment on them support the company’s ability to provide customers with safe and reliable power.
- The ongoing project to systematically replace portions of natural gas distribution pipe in Avista’s service area that were installed prior to 1987 as well as replacement of other natural gas service equipment to strengthen the integrity, safety and reliability of the system.
- The rebuild of a high voltage transmission line that had been serving customers for more than 100 years, including the installation of steel poles and crossarms.
- Technology upgrades that support necessary business processes and operational efficiencies that allow
Avista to effectively manage the utility and serve customers.
Residential Customer Bills
A residential customer’s bill today is only 2.3 percent higher, on average, than an equivalent bill in January of 2016. For natural gas, a residential customer’s bill is actually 24.4 percent lower over that same time period, on average. Overall,
Electric
Effective
Effective
Natural Gas
Effective
Effective
Changes by Service Schedule
The requested electric increase by service schedule is as follows:
Rate Schedule | Proposed 2020 Billing Increase | Proposed 2021 Billing Increase |
Residential Service - Schedules 1/2 | 9.8 percent | 3.7 percent |
General Service - Schedules 11/12 | 7.0 percent | 2.7 percent |
Large General Service - Schedules 21/22 | 8.7 percent | 3.3 percent |
Extra Large General Service - Schedule 25 | 8.8 percent | 3.3 percent |
Pumping Service - Schedules 31/32 | 8.7 percent | 3.3 percent |
Street & Area Lights - Schedules 41 – 48 | 0.0 percent | 0.0 percent |
Total | 8.8 percent | 3.3 percent |
The requested natural gas increase by service schedule is as follows:
Rate Schedule | Proposed 2020 Billing Increase | Proposed 2021 Billing Increase |
General Service - Schedules 101/102 | 10.4 percent | 4.7 percent |
Large General Service - Schedules 111/112/116 | 9.2 percent | 4.2 percent |
Interruptible Service – Schedules 131/132 | 6.2 percent | 2.9 percent |
Transportation Service - Schedule 146 | 14.4 percent | 6.3 percent |
Total | 10.1 percent | 4.6 percent |
The actual percentage increase for individual electric and natural gas customers would depend on how much energy a customer uses.
As a part of this general rate case,
Additional information about Avista’s rate request and energy prices is available at www.myavista.com/waraterequests.
Customer Resources
To assist customers in managing their energy bills,
About
This news release contains forward-looking statements regarding the company’s current expectations. Forward-looking statements are all statements other than historical facts. Such statements speak only as of the date of the news release and are subject to a variety of risks and uncertainties, many of which are beyond the company’s control, which could cause actual results to differ materially from the expectations. These risks and uncertainties include, in addition to those discussed herein, all of the factors discussed in the company’s Annual Report on Form 10-K for the year ended
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Source: Avista Corporation