Avista rate hike hearing tonight

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COEUR d'ALENE — A conservation group is among parties challenging proposed Avista Utilities rate hikes heading into tonight's public hearing in Coeur d'Alene.

The hearing held by the Idaho Public Utilities Commission is 6 to 8 p.m. at the Coeur d'Alene School District's Midtown Center, 1505 N. Fifth St. There will be no formal presentation at the hearing.

If approved by the IPUC, the proposed rate settlement would:

• increase electric rates by an average of 5.6 percent ($5.22 per month) on Jan. 1, 2018, and 2.3 percent ($2.16) on Jan. 1, 2019; and

• increase natural gas rates by an average of 1.9 percent ($1.13) in 2018 and 1.8 percent ($1.09) in 2019.

The proposals are about $2 per month less than what the utility originally proposed in June and before the settlement.

However, some parties, including the Idaho Conservation League, still have concerns about the proposals.

"We often seek common ground on these issues, but in this case we believe the settlement requires Avista customers to pay for some things that are not a good use of customer money and not good for Idaho's environment," said Ben Otto, energy associate for the ICL.

The Sandpoint-based nonprofit believes the settlement does not address Avista spending money on what it believes is an "ill-fated" coal plant Avista co-owns in Montana.

"This coal plant was built back in the ’80s and is an outdated, expensive and dirty technology that Avista customers shouldn't have to continue propping up," Otto said.

Avista officials said the proposed increases would help the company recover costs related to infrastructure, system maintenance, technology and power supply. They believe the proposals are fair and reasonable for their customers, the company and shareholders.

"This outcome provides us the opportunity to continue to earn a fair return in Idaho and supports Avista’s efforts to invest in and maintain our infrastructure so we can continue to provide the reliable energy our customers expect," said Dennis Vermillion, Avista Corp. senior vice president and president of Avista Utilities.

"In addition, the two-year rate plan would create a stay-out period where Avista would not file a new general rate case for a new rate plan to be effective prior to Jan. 1, 2020, providing customers with some predictability in their expected future energy prices."

State law requires that regulated utilities be allowed to recover their prudently-incurred expenses and earn a reasonable rate of return established by the IPUC. The burden of proof is on the utility to demonstrate that additional capital investment was necessary to serve customers.

The proposed settlement agreement was reached between several parties to the case after a conference in late September. Those parties include Clearwater Paper, Idaho Conservation League, Idaho Forest Group, the Community Action Partnership Association of Idaho and Sierra Club. Sierra Club and the ICL opposed the proposed settlement.

Avista's infrastructure projects include the rehabilitation and maintenance of the Kettle Falls electric generating facility that provides electricity for Idaho and Washington customers. The $6.3 million project would rewind the 30-plus-year-old generator that is at the end of its expected life.

More than $25 million in substation rebuilds are planned in the next two years. Substations in Priest River and Kamiah are among those proposed to be rebuilt because they have reached the end of their useful lives.

Avista’s application and exhibits are available at www.puc.idaho.gov. Click on "Open Cases" under the "Electric" or "Natural Gas" heading and scroll down to Case No. AVU-E-17-01 (electric) or AVU-G-17-01 (natural gas).

The deadline to submit written comments is Dec. 8. To submit those, go to the IPUC website and click on "Case Comment Form" under the "Electric" or "Natural Gas" heading and enter the case number. Comments can also be mailed to the IPUC, P.O. Box 83720, Boise, ID 83720-0074.

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