160819_AVUPCAREC.pdf

Case No. AVU-E-16-05, Order No. 33571
Contact: Gene Fadness [phone]
www.puc.idaho.gov

PCA is up for Avista customers, but higher BPA credit
results in proposed 0.3 percent rate decrease

BOISE (August 22, 2016) – The Idaho Public Utilities Commission will take comment through
September 15 on an Avista Utilities application to slightly decrease the variable portion of
customer rates.

Avista proposes to slightly reduce the size of the rebate given to customers in its annual Power
Cost Adjustment (PCA) which increases rates, while slightly increasing the credit customers get
as part of the Bonneville Power Administration’s Residential Exchange Program, which
decreases rates. The net result is a decrease of 0.3 percent or about 30 cents per month on an
average residential monthly bill. If approved, changes to both the PCA and the BPA credit would
be effective Oct. 1.
Every year on October 1, the variable portion of Avista rates is adjusted up or down depending
on the previous year’s power supply expense, which is largely determined by changes in
hydroelectric generation and market prices for natural gas and electricity.
While these applications impact variable rates, Avista has a separate application before the
commission to increase the fixed portion of rates, or base rates, by an average 6.3 percent.
Lower natural gas prices and less operating expense at the Colstrip and Kettle Falls plants kept
power supply costs down for Avista. But 13 percent below normal hydro generation, more
expense related to the operation of the Palouse Wind plant and a change in the contract
between Avista and Clearwater Paper resulted in overall greater PCA expense. Thus, the size of
the PCA rebate to customers is reduced from 0.032 cents per kilowatt-hour to 0.017 cents per
kWh, or a 0.2 percent increase to customers.
Offsetting the PCA increase is a larger credit than currently given residential and small-farm
customers as a result of the BPA Residential Exchange Program. BPA credits customers of
utilities who live near BPA’s hydroelectric projects along the Columbia River. The credit to
customers fluctuates each year depending on a formula BPA uses to calculate the benefit. A
higher benefit this year results in an overall decrease to customers of 0.5 percent.
The commission will take comments through Sept. 15 on the proposed changes. To comment
go to www.puc.idaho.gov. Under the “Consumers” heading, click on “Case Comment Form,”
and include the case number, AVU-E-16-05, in your comments. Comments can also be mailed
to the commission at P.O. Box 83720, Boise, ID, 83720-0074.
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