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FOR IMMEDIATE RELEASE
September 19, 2008
Public Counsel and industrial customers recommend reduction in Avista’s proposed electric and gas rate increases

SEATTLE – The Public Counsel Section of the Washington State Attorney General’s Office and the Industrial Customers of NW Utilities (ICNU) today challenged electric and gas rate increases proposed by Avista.

Avista’s original request, filed with the Utilities and Transportation Commission (UTC) in March 2008, would have generated an additional $43.2 million in revenues ($36.6 million from electric customers and $6.6 million from gas customers).

On September 16, 2008, a non-unanimous settlement was filed with the UTC by Avista, UTC Staff, Northwest Industrial Gas Users and the Energy Project. Public Counsel and ICNU, the two major customer representatives in this case, did not agree to the rate increase in the proposed settlement, in which Avista is requesting a total of $37.3 million ($32.5 million for electric and $4.8 million for gas). The UTC Staff recommendation regarding the proposed settlement is not binding on the Commission.

Simon ffitch, chief of the Public Counsel Section, which represents residential and small business customers in utility rate cases, said the request goes well beyond what the company has proved they actually need.

“We’re troubled that Avista is trying to rush through a proposed settlement that makes only a small dent in the size of the original rate increase request,” ffitch said. “We’ll be asking the Commission to hold a full hearing on our recommendations.”

In expert testimony to be filed today with the UTC, experts co-sponsored by Public Counsel and ICNU concluded that a reasonable revenue increase for Avista should be limited to $20.1 million from electric customers and $627,000 from gas customers– approximately $22.5 million less than the requested amount ($16.5 million less for electric; $6 million less for gas).

“All customers small and large will have difficulty absorbing a rate increase of this magnitude.  It is important that the Commission limit the increase to actual prudently incurred costs,” explained Brad Van Cleve, legal counsel for ICNU.

The testimony filed today includes analysis from Public Counsel and ICNU’s expert witnesses on numerous elements of Avista’s proposal. Highlights include recommendations that the UTC:
Reduce expense for depreciation of company plant and equipment by $2.2 million.

  • Reduce executive compensation by $490,000 for executive salaries and retirement benefits and remove $482,000 of incentive program costs.
  • Reduce expenses totaling $437,000 for advertising, charitable contributions, and sporting events.
  • Only allow Avista to recover tax amounts actually paid.

The UTC will examine the testimony and evidence presented by Public Counsel and other parties. Hearings to cross-examine expert witnesses are scheduled to begin December 1. The UTC is expected to issue a decision by February 2009.

Spokane-based Avista serves 230,364 electric customers and 143,673 natural gas customers mostly living in Eastern Washington.

PUBLIC COMMENT:
Members of the public can comment on the rate case and the sale case.
Written comments may be sent to UTC, P.O. Box 47250, Olympia, WA, 98504 or e-mail comments@utc.wa.gov. Include your name and mailing address, the name of the company (Avista), and docket no. UE-080416 (electric) and/or UG-080417 (gas).

For more information, customers may contact either the WUTC or Public Counsel:

  • UTC – (800) 562-6150, e-mail at comments@utc.wa.gov. Information is available online at www.wutc.wa.gov. Enter docket no. 080416 (electric and gas consolidated)
  • Attorney General’s Office Public Counsel Section -- Public Counsel, Attorney General’s Office, 800 Fifth Avenue, Suite 2000, Seattle, WA 98104-3188, or e-mail utility@atg.wa.gov.

The Public Counsel Section advocates for the interests of consumers on major rate cases, mergers and other rulemakings before the UTC. Public Counsel also advocates for consumers in court appeals, through technical study groups and before the Legislature and other policy makers. The office maintains contact with the public through a citizen advisory committee, community organizations, public hearings and personal contact with consumers in major cases. More information about Public Counsel’s work is available online at http://www.atg.wa.gov/utilities.aspx.

ICNU is a non-profit trade association that represents its industrial customer member interests in northwest electric energy related issues.  ICNU has participated in every Avista-related rate case before the UTC since 1996.


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Contact:
Simon ffitch,  Public Counsel Section, (206) 389-2055
Brad Van Cleve, Legal Counsel for ICNU, (503) 241-7242
Janelle Guthrie, Director of Communications, (360) 586-0725

 


 

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