Idaho Power wants to decrease customers' rates by $40 million this year, amounting to $3 in monthly savings for the typical residential customer in Idaho.
The proposed decrease is a result of the company's annual power cost adjustment, which increases or decreases rates based on Idaho Power's anticipated fuel costs for generating electricity, costs of power purchases to meet customer demand and revenue resulting from sales of surplus energy. The adjustment, which must be approved by the Idaho Public Utilities Commission, can only be made to meet costs, not make a profit. In 2006 and 2010, the adjustment resulted in a decrease to customers.
The change would amount to an average 4.8 percent decrease in power bills beginning June 1. However, this is not the only annual rate adjustment. In March, Idaho Power submitted two rate-increase proposals to the commission. The first is the annual fixed-cost adjustment, which applies to costs that are the same regardless of the demand for electricity, such as property taxes and salaries. The other increase is for pension funding. These filings together request recovery of $14.7 million, or about a 2 percent increase in rates. Those changes would also go into effect June 1 if they are approved.
Even with these increases taken into account, customers would still experience an overall rate reduction of more than $25 million, or a 3 percent decrease.
"Idaho Power is sensitive to the challenges faced by its customers in these difficult economic times," said Greg Said, the company's vice president of regulatory affairs. "We are pleased to be in a position to reduce our customers' rates as our state works toward economic recovery."
Idaho Power serves 492,000 customers over 24,000 square miles of southern Idaho and eastern Oregon. The core of its electricity generation comes from 17 hydroelectric projects.
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