Deal lowers proposed Avista hikes

By BRIAN WALKER

Hagadone News Network

Avista and parties to the company's electric and natural gas general rate increase proposals have reached a proposed deal that reduces the hikes by about $2 per month for each of the next two years from what the utility proposed in June.

If the Idaho Public Utilities Commission approves the agreement, the rate increases would be:

- $5.22 per month (5.9 percent) for the average residential electric customer starting Jan. 1, 2018 and $2.16 per month (2.3 percent) starting Jan. 1, 2019; and

- $1.13 per month (2.1 percent) for the average residential natural gas customers starting Jan. 1, 2018, and $1.09 per month (2 percent) starting Jan. 1, 2019.

The IPUC will schedule a public hearing and comment period on the proposals, said Matt Evans, IPUC spokesman.

"The commission is expected to hold a public hearing on the case in late November in Coeur d’Alene," he said, adding that further details have not been approved.

The public comment period will end Dec. 8.

Avista officials said the proposed increases would help the company recover costs related to infrastructure, system maintenance, technology and power supply.

"This settlement agreement will provide new rates in Idaho that are fair and reasonable for our customers, the company and our shareholders," said Dennis Vermillion, Avista Corp. senior vice president and president of Avista Utilities.

"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. 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."

If approved, the settlement agreement is designed to increase annual billed electric revenues by $12.9 million (5.6 percent) effective Jan. 1, 2018, and by $4.5 million (2.3 percent) effective Jan. 1, 2019.

For natural gas, the settlement agreement is designed to increase annual billed revenues by $1.2 million (1.9 percent) effective Jan. 1, 2018, and by $1.1 million (1.8 percent) on Jan. 1, 2019.

A public comment period and workshop were held on the original increase proposals prior to the settlement agreement.

The company'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.

Several transmission projects totaling $25 million over the next two years that are required to comply with federal standards are also planned, including the Coeur d'Alene to Pine Creek line.

Avista also plans to remove and replace natural gas lines that are more than 30 years old throughout its service territory.

The rate increase proposals are separate from and not related to the proposed acquisition of Avista by the Canadian firm Hydro One, Avista and IPUC officials said.

Avista serves about 125,000 electric and 75,000 natural gas customers in North Idaho.