(Release from Idaho Power)
Idaho Power has filed the final piece of its spring cost adjustments with the Idaho Public Utilities Commission (IPUC). This year’s Power Cost Adjustment (PCA) calls for a rate decrease of $50 million across all customer classes.
If the PCA proposal is approved by the IPUC as filed, the typical Idaho residential customer using 950 kilowatt-hours (kWh) of energy per month would see a $3.35 decrease on their monthly bill related to this specific request, beginning June 1. However, the overall impact on customer bills is dependent on the outcome of four recent filings, not just the PCA. If all filings are approved by the IPUC as requested, the typical residential customer will have a combined decrease of $0.59 per month. These are the four recent filings:
• The annual PCA is a cost-recovery tool that passes on both the benefits and costs of supplying energy to Idaho Power customers.
• The annual Fixed Cost Adjustment (FCA), filed in March, adjusts prices based on changes in energy use per customer during the previous year.
• This year, Idaho Power also filed a rate adjustment to recover costs related to the company’s planned exit from the North Valmy power plant (Valmy).
• This year, Idaho Power also requested a downward adjustment to the Idaho Energy Efficiency Rider (EE Rider).
The impact of all filings for all customer classes is shown below. The actual percentage of change will depend on a customer’s class and the rate they pay.
2019 RATE FILINGS
Percentage Change from Current Billed Revenue
Filing Residential Small General Service Large General Service 1 Large Power 2 Irrigation
EE Rider -0.90% -0.91% -0.91% -0.89% -0.91%
Valmy 0.11% 0.10% 0.11% 0.11% 0.11%
FCA 3.64% 3.70% N/A N/A N/A
PCA -3.49% -2.79% -4.75% -6.29% -4.33%
COMBINED IMPACT3 -0.65% 0.10% -5.55% -7.06% -5.13%
1 Includes lighting schedules; 2 Includes special contracts; 3 Totals may not add up exactly due to rounding
This is the second consecutive year that residential customers will see an overall price decrease on their bills. On top of that, three classes of business customers, including irrigators, will see more than a 5% decrease in their bills. Overall, Idaho Power prices are about 20% lower than the national average.
The PCA has two main components: the forecast and the true-up. The forecast looks ahead to Idaho Power’s anticipated fuel costs, purchased power costs and customer benefits from sales of surplus energy for the coming April through March. The true-up brings last year’s forecasted costs in balance with costs actually incurred by the company by looking back at what happened the previous April through March.
These are the main factors contributing to this year’s PCA decrease:
Last year’s actual power supply costs were less than anticipated, primarily due to better-than-expected water conditions and benefits from lower-than-expected natural gas costs. Additionally, forecast power supply costs for the coming April through March are less than last year’s forecast, primarily due to an anticipated increase in sales of surplus energy, which benefits customers as an offset to other power costs.
The 2019 PCA adjustment also includes revenue sharing and tax reform changes:
• Included in this year’s PCA rates, customers will receive a $5 million revenue sharing credit. Since 2009, customers have received more than $126 million in revenue sharing benefits.
• Additionally, last year’s PCA rate included a $7.8 million tax reform benefit to be credited to customers June 1, 2018, through May 31, 2019. This year, that credit amount changes to $2.7 million starting June 1.
The PCA is an annual adjustment mechanism that allows Idaho Power to either recover costs or credit benefits associated with annual fluctuations in power costs. These typically represent approximately one-fourth to one-third of the company’s annual cost of serving customers.
Opportunities for Public Review
Idaho Power’s filing is a proposal that is subject to public review and approval by the IPUC. Copies of the application are available to the public at the IPUC offices (472 W. Washington St., Boise, Idaho, 83702), Idaho Power offices or on Idaho Power’s website, idahopower.com, or the IPUC website, puc.idaho.gov. Customers also may subscribe to the IPUC’s RSS feed to receive periodic updates via email about the case. Written comments regarding Idaho Power’s application may be filed with the IPUC.
About Idaho Power:
Idaho Power, headquartered in vibrant and fast-growing Boise, Idaho, has been a locally operated energy company since 1916. Today, it serves a 24,000-square-mile area in Idaho and Oregon. The company’s goal to provide 100% clean energy by 2045 builds on its long history as a clean-energy leader that provides reliable service at affordable prices. With 17 low-cost hydroelectric projects at the core of its diverse energy mix, Idaho Power’s residential, business and agricultural customers pay among the nation’s lowest prices for electricity. Its 2,000 employees proudly serve more than 550,000 customers with a culture of safety first, integrity always and respect for all.
IDACORP Inc. (NYSE: IDA), Idaho Power’s independent publicly traded parent company, is also headquartered in Boise, Idaho. To learn more, visit idahopower.com or idacorpinc.com.