Avista Requests Multi-Year Electric and Natural Gas Rate Increase in Idaho
Increased capital investments in infrastructure and technology are the major drivers in Avista's (NYSE: AVA) two-year electric and natural gas rate plan request filed today with the
Avista's request, if approved, is designed to increase annual electric revenues effective
In addition, Avista's request, if approved, is designed to increase annual electric revenues effective
"Our general rate requests continue to be driven by the ongoing need to maintain, replace and invest in the facilities and equipment we use every day to serve our customers," Avista Chairman, President and Chief Executive Officer
"We understand that rate increases can be challenging for our customers. While the costs of doing business continue to rise, we maintain a firm focus on managing our costs so that our customers can continue to have energy prices that are among the lowest in the country," Morris said.
Avista serves more than 127,000 electric and nearly 78,100 natural gas customers in
Residential Customer Electric Bill
If Avista's 2016 electric request is approved, a residential customer using an average of 929 kilowatt hours per month could expect to see a bill increase of
For 2017, the proposed increase is
As a part of its application, Avista has also proposed to use
The requested electric increase by service schedule for the two-year rate plan is:
Rate Schedule |
Description |
2016 Billing
Increase |
2017 Billing
Increase |
||
Residential Service | Schedule 1 | 6.9% | 6.7% | ||
General Service | Schedules 11 & 12 | 3.5% | 3.5% | ||
Large General Service | Schedules 21 & 22 | 4.5% | 4.5% | ||
Extra Large General Service | Schedule 25 | 4.5% | 4.5% | ||
Extra Large General Service 25P | Schedule 25P | 2.6% | 2.7% | ||
Pumping Service | Schedules 31 & 32 | 5.2% | 5.1% | ||
Street & Area Lights | Schedules 41 - 49 | 6.1% | 5.9% | ||
Total | 5.2% | 5.1% | |||
Residential Customer Natural Gas Bill
A residential natural gas customer using an average of 61 therms per month could expect to see a
For 2017, the proposed increase is
As a part of its application, Avista has proposed to use
The requested natural gas increase by service schedule for the two-year rate plan is:
Rate Schedule |
Description |
2016 Billing
Increase |
2017 Billing
Increase |
General Service | Schedule 101 | 6.5% | 2.9% |
Large General Service | Schedules 111 & 112 | 3.5% | 1.3% |
Interruptible Service | Schedules 131 & 132 | 5.5% | 2.0% |
Transportation Service | Schedule 146* | 4.5% | 5.4% |
Total | 5.8% | 2.5% | |
* excludes natural gas costs | |||
Capital Investments
Capital investments included in Avista's request include upgrades and maintenance of the company's generation facilities, transmission and distribution equipment, natural gas pipe, and information technology. Costs to replace facilities and parts of our system are many times more expensive today than when originally installed. This is the primary reason for the need to increase rates.
Among the major capital investments in today's filing are:
- the ongoing and multi-year redevelopment of the 105-year-old Little Falls Powerhouse on the Spokane River to increase generation reliability and the continuing rehabilitation of the 107-year-old Nine Mile Powerhouse on the Spokane River, including the replacement of original generators, turbines and other equipment which will increase the generation of clean, renewable power;
- information technology upgrades, including the replacement of Avista's 20-year-old legacy customer information system which supports traditional utility business functions, such as meter reading, customer billing, payment processing, credit, customer service orders and material management; and
- the ongoing project to systematically replace portions of natural gas distribution pipe, including hundreds of miles of natural gas distribution lines in Avista's service area that were installed prior to 1987.
Fixed Cost Adjustment
The request also includes a proposed electric and natural gas Fixed Cost Adjustment (FCA) mechanism. The FCA is a mechanism designed to break the link between a utility's revenues and a consumer's energy usage. The company's actual revenue, based on kilowatt-hour and therm sales, will vary, up or down, from the level set by the IPUC. This could be due to changes in conservation, weather or the economy.
Under the proposed FCA mechanism, the company's electric and natural gas revenues would be adjusted each month to reflect revenues based on the number of customers, rather than kilowatt-hour and therm sales. The difference between revenues based on sales and revenues based on the number of customers will result in either surcharges or rebates to customers in the following year.
Customer Assistance
To assist customers in managing their energy bills, Avista offers services such as comfort level billing, payment arrangements and Customer Assistance Referral and Evaluation Services (CARES). CARES provides assistance to special-needs customers through referrals to area agencies and churches for help with housing, utilities, medical assistance and other needs. To learn more, visit www.avistautilities.com. There, customers can also find information on energy efficiency rebates and incentives, as well as online tools for managing energy use.
More Information
Avista's application is a proposal, subject to public review and a decision by the commission. A copy of the application is available for public review at the offices of both the commission and Avista, and on the commission's homepage (www.puc.idaho.gov). Customers may also subscribe to the commission's RSS feed (http://www.puc.idaho.gov/rssfeeds/rss.htm) to receive periodic updates via e-mail about the case.
Additional information about Avista's rate request, including a video, is available at www.avistautilities.com/idrates.
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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