20040409Press Release.pdf

IDAHO PUBLIC UTILITIES COMMISSION
For Immediate Release
Case No. A VU-04-, A VU-04-
April 9, 2004
Contact: Gene Fadness [phone]
Website: www.puc.state.id.
Hearings announced in Avista rate case
Boise - Hearings are scheduled for Kellogg, Sandpoint and Lewiston on July 26 and 27
regarding Avista Utilities' application to the Idaho Public Utilities Commission to increase both
its electric and gas rates.
The commission also announced a technical hearing for the week of July 19 in Boise and set
deadlines for testimony and exhibits from the company, commission staff and other intervenors
in the case.
The public hearings will give A vista ratepayers an opportunity to offer testimony to the three
members of the commission regarding the company s proposal. A more informal series of
workshops that allow ratepayers to ask questions of commission staff are also tentatively
scheduled for late May in Moscow and Coeur d'Alene.
Avista, which has about 105 000 customers in its northern Idaho territory, is requesting an
average 24.1 percent increase in electric rates and a 9.2 percent average increase in gas rates.
Avista is also proposing a reduction in its annual power cost adjustment surcharge that would
lessen the 24.1 percent increase to residential customers to about 13.5 percent. A vista proposes
an increase in the monthly customer service charge from $4 to $5 per month for electric
customers.
Commission staff, which includes auditors, engineers and attorneys, is investigating the utility'
application. Commission staff, Avista and intervenors will file their testimony and exhibits by no
later than June 21. Rebuttal testimony and exhibits are due July 12. The commission will post
testimony and exhibits from all parties on its Web site.
Intervenors in the case include Potlatch Corporation, Coeur Silver Valley, Inc., and the
Community Action Partnership of Idaho. Coeur Silver Valley owns two silver mines between
Osborn and Wal1ace. The Community Action Partnership of Idaho is a non-profit corporation
consisting of six community action agencies across the state, representing the interests of
primarily low-income citizens.
According to the company s calculations, a residential electric customer using 1 000 kWh a
month would see an increase from $60.15 to $68.37 if Avista s proposal were accepted. That
includes the proposed reduction in the power cost adjustment surcharge.
A vista s proposed electric increases for other customer classes, including the proposed reduction
in the power cost surcharge, are 8.7 percent for general service, 10.1 percent for large general
service and 12.1 percent for irrigation customers.
A vista claims the electric increase is needed because of the addition of new generation, a
reduction in wholesale sales revenue, increased natural gas costs, a decline in electric use by
customers, record low-water conditions and unprecedented high wholesale market prices that
resulted in credit ratings below investment grade and increased financing costs.
Gas rates for residential customers would increase by 10 percent under A vista s proposal from
78.69 cents per therm to 86.56 cents. The company proposes an increase from $3.28 to $5 per
month in the customer service charge for gas customers. Under the company s proposal, the
monthly bill for a residential gas customer using an average of70 therms of natural gas would
increase from $57.68 to $63.26.
The company claims the gas rate increase is needed because of a decline in natural gas use by
customers, a growth in the number of customers and general increases in expenses since the last
rate increase 14 years ago.
Last fall, the commission extended for one year a 19.4 percent surcharge added to electric
customers' bills to recover costs associated with the record-low stream flow conditions and high
market prices during the energy crisis of 2000-0 1. Under the company s proposal, that surcharge
would be reduced and spread over two years, reducing the size of the general rate increase on
customers.
In that same power cost adjustment case, commission staff recommended that the commission
deny Avista authority to collect nearly $12 million from customers in expenses resulting from
two fuel purchases for the company s Coyote Springs II gas-fired generating plant. In order to
allow A vista an opportunity to defend the fuel purchases, the commission agreed to defer the
matter to this rate case.
The public hearing schedule is as follows:
Kellogg - Monday, July 26, at 1 p.m. at the Silver Valley Job Service, 35 Wild Cat Way.
Sandpoint - Monday, July 26, at 7 p.m. at the Edgewater Resort, 56 Bridge St.
Lewiston - Tuesday, July 27, at 6 p.m. at the Nez Perce County Commissioners hearing
room, 1225 Idaho St.
Dates, times and locations for the public workshops in Moscow and Coeur d' Alene will be
announced soon.
Copies of the company s application and other documents are available on the commission
Web site at www.puc.state.id.. Click on "A vista Rate Case " under the "Hot" items in the
upper-right hand corner. They are also available for public inspection at the commission s offices
on 472 W. Washington St., Boise.