Avista (AVA) Files General Rate Request in Washington
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Avista (NYSE: AVA) filed its general rate request today with the Washington Utilities and Transportation Commission (UTC or Commission), seeking recovery of costs associated with capital investments and operations and maintenance expenses. The UTC has up to 11 months to review the filings and issue a decision.
If the Commission approves the requests, an electric residential customer in Washington using an average of 989 kilowatt hours per month would see an increase of 6.3 percent or $4.94 per month, inclusive of the proposed Energy Recovery Mechanism (ERM) rebate, or about 16 cents a day, for a revised bill of $83.91. Natural gas customers in Washington using an average of 68 therms per month would see an increase of 6.9 percent or $4.23, or about 14 cents a day, for a revised monthly bill of $65.78.
Avista proposed an overall net electric rate increase of 5.9 percent, which is composed of a billed rate increase of 8.8 percent to produce $41 million in additional electric revenue, offset by a proposed one-year Energy Recovery Mechanism bill decrease (rebate to customers) of 2.9 percent, or $13.6 million.
The Energy Recovery Mechanism is designed to recover, or rebate to customers, changes in certain power supply costs that are above or below the amount included in Washington base customer rates. The major portion of an Avista electric customer's bill, about 60 percent, is the cost of generating or purchasing electricity to meet customer needs. These costs may fluctuate up or down, and the ERM is designed to track the variability in these costs. Power supply costs were lower in 2011, due to factors such as declining natural gas prices and favorable hydroelectric conditions. The remaining 40 percent of a customer's bill covers the cost of delivering the electricity -- the equipment and people needed to provide safe, reliable service.
Avista has also requested a $10.1 million increase in natural gas revenues, or a 6.8 percent overall increase. The electric and natural gas filings reflect a proposed rate of return on rate base of 8.25 percent with a common equity ratio of 48.4 percent and a 10.9 percent return on equity.
If the Commission approves the requests, an electric residential customer in Washington using an average of 989 kilowatt hours per month would see an increase of 6.3 percent or $4.94 per month, inclusive of the proposed Energy Recovery Mechanism (ERM) rebate, or about 16 cents a day, for a revised bill of $83.91. Natural gas customers in Washington using an average of 68 therms per month would see an increase of 6.9 percent or $4.23, or about 14 cents a day, for a revised monthly bill of $65.78.
Avista proposed an overall net electric rate increase of 5.9 percent, which is composed of a billed rate increase of 8.8 percent to produce $41 million in additional electric revenue, offset by a proposed one-year Energy Recovery Mechanism bill decrease (rebate to customers) of 2.9 percent, or $13.6 million.
The Energy Recovery Mechanism is designed to recover, or rebate to customers, changes in certain power supply costs that are above or below the amount included in Washington base customer rates. The major portion of an Avista electric customer's bill, about 60 percent, is the cost of generating or purchasing electricity to meet customer needs. These costs may fluctuate up or down, and the ERM is designed to track the variability in these costs. Power supply costs were lower in 2011, due to factors such as declining natural gas prices and favorable hydroelectric conditions. The remaining 40 percent of a customer's bill covers the cost of delivering the electricity -- the equipment and people needed to provide safe, reliable service.
Avista has also requested a $10.1 million increase in natural gas revenues, or a 6.8 percent overall increase. The electric and natural gas filings reflect a proposed rate of return on rate base of 8.25 percent with a common equity ratio of 48.4 percent and a 10.9 percent return on equity.
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