Rocky Mountain Power wants a 10% rate hike

Rocky Mountain Power President Richard Walje said a rate increase in the 10 percent range would help the utility meet its expenses and plans for developing clean energy to meet growing demand for electricity in Utah.

Speaking Friday to the Deseret News editorial board, he also said he would like to see state regulators take a longer-term view when considering how much of a rate increase the utility should get to meet the needs of customers during the next several years.

In Rocky Mountain Power's most recent rate case, the Utah Public Service Commission in August granted the utility a 2.7 percent rate increase, or $39.4 million. But the company had asked for nearly twice that much. The utility also has a second request pending before the commission for $85.2 million above the amount of the first request.

"We have a huge investment profile that we're having to meet in the future, and the return we received out of that (most recent) case isn't adequate to fund that," Walje said Friday.

He would like to see the commission allow the utility to recoup the costs it incurs from expenses from large capital investments sooner, he said. "If you're spending as much money as we have, unless you have frequent rate cases, you're making hundreds of millions of dollars of investments that aren't actually paid for concurrently with when they become used and useful."

Michele Beck, executive director of the Committee of Consumer Services, said Rocky Mountain Power would need to present its case in a fashion that better demonstrates its needs if it wanted to justify more rate hikes.

She said that having a more standardized set of documentation that utilities are required to file in their rate cases might be helpful to companies in their attempts to justify their rate-hike requests to the commission.

Commission spokeswoman Julie Orchard said the commission gives specific details about how each case should be presented in the commission's final order, and companies should heed those instructions in their subsequent rate cases.

"They have lots of resources and many brilliant attorneys, and they should be able to determine what information they need to file to be able to achieve the outcome that would be the most beneficial to them as a company," she said.

Looking forward, Walje said he would like to see a strategy developed that would allow the company to continue its development of alternative energy sources such as wind and solar power.

"We'll have spent almost $2 billion in the last three years on renewable energy, and that has been to consumers almost zero-cost electric energy," he said. "Let's make sure at least those investments can be lined up so that we can get the return on that investment at the same time that consumers get the benefit."

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E-mail: jlee@desnews.com