SALT LAKE CITY — Paying to keep the lights on can put a strain on many a household budget. But some Utahns might be surprised to learn that their electricity rates are among the lowest in the West.
Last week, Rocky Mountain Power announced it would be seeking a $232.4 million general rate hike, which would increase the typical household power bill by about $10 per month.
The company said the reasons for the rate hike request are the ever-increasing costs to produce electricity and heavy investments in equipment to serve customers. The funding is also needed to maintain and upgrade existing facilities as well as increase capacity to meet increasing customer demand.
That would seem all well and good, but the announcement was met with skepticism by some ratepayers who thought their rates were already high enough. The Utah Public Service Commission will have 240 days from the date of submission to review the request before deciding how much of an increase will be implemented sometime this fall.
While some Utahns may believe they pay a pretty penny to power their homes, data from the U.S. Energy Information Administration would suggest otherwise when compared to neighboring states and the rest of the country.
Among eight states that make up the Mountain Region, Utah paid the second lowest residential electricity rates at 8.51 cents per kilowatt-hour as of October 2010. Only Idaho had a lower residential rate at 8.02 cents per kilowatt-hour — also the lowest in the nation — while Nevada paid the highest regional residential rates at 12.18 cents per kilowatt-hour.
Utah boasts some of the most diverse and relatively abundant natural resources in the nation, which has resulted in its relatively low utility rates.
Approximately 82 percent of the electricity produced in Utah in 2008 was from coal-fired generation, with six plants active statewide, according to the Utah Geological Survey. Natural gas accounted for the second-largest proportion at 15.6 percent. Hydroelectric provided 1.4 percent, while geothermal and petroleum each comprise less than 1 percent of net generation of electricity in Utah.
Other sources, such as solar and wind energy, make up an even smaller proportion of the total energy mix.
The Mountain Region is comprised of Arizona, Colorado, Idaho, Montana, New Mexico, Nevada, Utah and Wyoming. The region residential average was 10.44 cents compared to the U.S. residential average of 11.93 cents.
Utah was among the lowest in each of the five rate usage sectors in the region: residential, commercial, industrial, transportation and all sectors (overall).
The Pacific Noncontiguous states of Alaska (16.27 cents) and Hawaii (28.46 cents) paid the highest residential rates per kilowatt-hour as well as the highest average overall sectors at 14.65 cents and 25.33 cents respectively.
For the lower 48, the New England states had the highest residential average at 16.68 cents per kilowatt-hour — topped by Connecticut at 19.84 cents. The Nutmeg State also recorded the highest overall rate at 17.28 cents.