Utah's largest electric utility announced late Tuesday that effective Sept. 15, it would implement a hiring freeze directed at customer service positions in Utah.
In addition, the company said in a news release that it would limit overtime for restoring power to "only when employee or public safety is threatened," eliminate discretionary maintenance, discontinue funding of research associated with renewable and clean-coal technology and discontinue support for economic development activities.
The company cited as the reason for the decisions the recent rate order issued by the Utah Public Service Commission, which the company said was not enough to meet the utility's needs to serve its growing customer base.
The commission in August approved a rate increase for Rocky Mountain Power that was a fraction of what the utility sought.
In July, Rocky Mountain Power filed an application with the commission requesting a total rate increase of $160.6 million, or 11.2 percent more than Rocky Mountain was charging customers at that time.
Last December, the utility requested an increase of $161.2 million. The commission, in March, issued an order requiring the company to reduce its rate-increase request to $99.8 million.
The company reduced its request again in May to $84.5 million and yet again in June to $74.4 million. But in its final order last month, the commission determined that the increase should be only $33.4 million.
The utility's second request, for $85.2 million beyond the amount of the first request, was an attempt to eventually gain the $160.6 million overall rate boost.
The utility stated in its latest announcement that "after analyzing the commission's order, the company determined the commission did not provide sufficient revenue to support the electric service levels needed to meet Utah's growing demand for electricity."
Rocky Mountain Power spokesman Dave Eskelsen said the "petition for reconsideration was filed" Tuesday. He said the commission has up to 20 days to review the petition and act on it or it can choose to do nothing and effectively deny the petition.
In addition to the previously mentioned changes, the company said in the release it would "seek relief and work with appropriate parties to reduce Utah property-tax payments to the level allowed by the commission, review the level and types of corporate philanthropy and ultimately consider curtailing electric service when the cost of purchasing electricity to serve customers in Utah is prohibitive and exceeds the funding the commission provided to purchase and generate electricity to serve customers."
"Growth does not come without significant challenges," said Richard Walje, president of Rocky Mountain Power in the release. "The cost of providing for increased electric consumption by existing customers and the cost of providing service to new customers has exceeded the revenue the company receives from these customers."
Unfortunately, the amount of revenue provided the company in the commission's order does not reflect the true cost of providing electrical service, and as a result the company is unable to continue its current approach to providing service, the release said.
The utility said that the rapidly rising price of coal, natural gas and purchased electricity it buys to serve customers increases between $16 million and $20 million every six months."We regret the impact the recent decision of the commission will have on the level of service we are able to provide," Walje said.
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