20151222press release.pdf

Case No. AVU-E-15-05, AVU-G-15-01, Order No. 33437
Contact: Gene Fadness [phone], 890-2712
www.puc.idaho.gov

PUC adopts settlement to Avista case, agrees
to implement annual fixed cost adjustment

BOISE (Dec. 22, 2015) – The Idaho Public Utilities Commission is adopting a settlement to the
Avista Utilities electric and natural gas rate case that increases electric rates an average 0.6%
(six-tenths of 1%) and natural gas rates by 3.5% effective Jan. 1, 2016.

The settlement is a significant reduction from Avista’s original electric rate request of 10.3%
over two years – 5.2% in 2015 and 5.1% in 2017. On the gas side, Avista originally requested
4.5% in 2016 and 2.2% in 2017.

The settlement reduces Avista’s requested annual electric revenue increase from $13.2 million
to $1.7 million. It reduces the requested natural gas annual revenue increase from $3.2 million
to $2.5 million. Avista sought a 9.9% return on equity and was granted 9.5%.

For a residential customer who uses the company average of 929 kilowatt-hours per month, the
increase is about 75 cents per month. The original request would have increased bills by about
$5.92 per month in 2016 and $6.10 in 2017. For a natural gas customer who uses the company
average of 61 therms per month, the increase is about $3.20 per month, counting the $1 per
month increase in the basic service charge. The original request would have increased natural
gas bills $3.90 per month in 2016 and $1.79 per month in 2017.

Parties signing the settlement include Avista, commission staff, the Idaho Conservation League,
Snake River Alliance, Clearwater Paper Corporation, Idaho Forest Group LLC and the
Community Action Partnership Association of Idaho, which represents primarily customers on
low- and fixed-incomes.

The commission approved the company’s request for an annual rate adjustment called the
Fixed Cost Adjustment (FCA). The FCA will be a surcharge or a rebate granted every year
depending on whether Avista recovers its fixed costs of doing business. During some years, the
utility may not recover its fixed costs due to changes in conservation, weather or the economy.
By ensuring that Avista recovers its fixed costs when electricity and natural gas sales decline,
the FCA removes the disincentive for Avista to invest in and promote energy efficiency
programs.

The FCA will have an initial term of three years and will be reviewed to determine whether the
adjustment should continue. During those years when there is a surcharge, the charge cannot
exceed 3%. There is no cap on the amount a rebate can be.

Petitions for reconsideration must be submitted by no later than Jan. 8. Petitions must cite why
the order is unreasonable, unlawful or erroneous. Petitions should include a statement of the
nature and quantity of evidence the petitioner will offer if reconsideration is granted.

Petitions can be delivered to the commission at 472 W. Washington St. in Boise, mailed to P.O.
Box 83720, Boise, ID, 83720-0074, or faxed to 208-334-3762.

The commission’s final order and other documents are available on the commission’s website
at www.puc.idaho.gov. Click on Open Cases under the “Electric” heading and scroll down to
Case No. AVU-E-15-05.

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