February 28, 2008
IPUC Approves General Rate Case

The Idaho Public Utilities Commission today approved a stipulation agreement between Idaho Power, the IPUC staff, and representatives of various customer groups that concludes a general rate case filed by the company in June, 2007.

The stipulation calls for an average increase of 5.2 percent to the base rates paid by Idaho Power customers in Idaho or about a $32 million increase in the company’s annual electricity revenues.  The changes in rates become effective on March 1.

“We believe this was a fair and equitable resolution to our general rate case,” said Idaho Power Vice President for Regulatory Affairs Ric Gale. “We’re pleased that the commission agreed with its staff, our customers and the company in this settlement.”

Idaho Power filed its general rate case requesting an annual increase to its Idaho retail base rates of $64 million or 10.35 percent.  Base rates reflect the company’s cost of equipment, vehicles and infrastructure needed to provide electrical service to its customers.

Customer Impacts

Today’s settlement has differing impacts on the rates paid by Idaho Power’s Idaho customers.  Rates paid by residential customers will increase by 4.7 percent while the rates paid by all other customer groups will increase by 5.65 percent.  The monthly bill for a typical residential customer using 1,050 kilowatt-hours (kWh) per month will increase from $64.42 to $67.32 during non-summer months, and from $69.61 to $72.76 per month during June, July and August, for an average monthly increase of $2.96, or about a dime a day. The chart below shows the average base rate per kWh for all customer groups:

Customer Group

Current Average Base Rate

Proposed Average Base Rate

Overall Percent Increase

Residential

5.92 cents

6.20 cents

4.7 percent

Small Commercial

7.39 cents

7.81 cents

5.65 percent

Large Commercial

4.03 cents

4.26 cents

5.65 percent

Irrigation

3.07 cents

4.86 cents

5.65 percent

Industrial

4.60 cents

3.24 cents

5.65 percent

 

Background

In its original June 2007 filing the company projected that it placed an additional $300 million of investment in service in its electrical system during 2006 and 2007. 

This investment included:

  • more than $200 million in the company’s distribution and transmission system, including nearly 650 miles of new transmission and distribution lines and 10 new substations, and
  • $80 million for maintenance and improvements at its existing power plants, including: $47 million for equipment upgrades, environmental protection measures and other investments at the company’s coal- and gas-fired plants, and
  • $34 million of relicensing and equipment investments related to its hydroelectric projects.

Operating and maintenance expenses have increased substantially over the same two-year period driven by increased levels of power purchases, continued rapid customer growth and inflation.

Today Idaho Power provides electricity to more than 481,000 customers in a 24,000-square-mile service area that includes portions of southern Idaho and eastern Oregon.