From Deseret News archives:
Utah power rates may jump
The 11.3 percent increase would be effective in August 2008. If approved, the rate hike would be the third in as many years and translate to an average increase of approximately $4.50 per month for a typical residential customer using 767 kilowatt-hours, according to the utility.
In December 2006, Rocky Mountain Power received a rate increase of 9.95 percent, and in March 2005, the utility received a 4.4 percent rate hike.
"The reason there have been a series of rate increases the last several years is that the company is in a vigorous growth cycle," said David Eskelsen, the company's external communications manager. "Customers are using more energy every year than they ever have."
He said the major factors driving the request are the large investments needed to provide electrical service to customers and the rising cost of generating and purchasing electricity.
Rocky Mountain Power estimates that capital investments will approach $2.8 billion over the next two years. The total amount of its Utah request is said to be $161 million.
Eskelsen said in response to the increasing demand for electricity, "rates need to be generating sufficient money to pay the cost of that capital investment." He said the utility is facing the same issues in other states that it services.
"The company has proposed earlier this year similar increases for its customers in Idaho and Wyoming," Eskelsen said.
Despite the increases in Utah in recent years, the state still has some of the most affordable electricity rates in the nation. The Beehive State and neighboring Idaho are among 11 states that pay less than 8 cents per kilowatt hour for power. In contrast, Colorado and Arizona pay over 9 cents per kilowatt hour, while California and Nevada customers pay more than 11 cents per kilowatt hour.
Eskelsen said the rates for Utah in 1986 were about 8.5 cents per kilowatt hour, compared with the approximately 7.5 cents per kilowatt hour customers pay today.
"Rates that we're paying now are roughly about the same number per kilowatt hour that they were 20 years ago," he said.
Eskelsen added even if Rocky Mountain Power's request is granted in full, residential rates will still be below 1986 levels.
The current rate-increase proposal will be reviewed by the state Public Service Commission, which will conduct public hearings before making a final decision. Rocky Mountain Power estimates the process may extend to next August.
Rocky Mountain Power, which is part of PacifiCorp, serves approximately 758,000 customers in Utah. The utility also operates in Wyoming and Idaho.
E-mail: jlee@desnews.com
