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Attorney General Challenges PSE, Avista Rate Increase Requests

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AG Bob Ferguson logoAttorney General Bob Ferguson’s Public Counsel Unit is challenging rate increases proposed by Puget Sound Energy (PSE) and Avista Corporation in testimony filed with the Utilities & Transportation Commission (UTC).

Regulated utilities such as PSE and Avista are allowed to impose rate increases on customers that are “fair, just, and reasonable.” Decades of judicial action have helped define those terms. The Attorney General’s Public Counsel Unit represents the public and opposes rate increases that are not “fair, just, and reasonable.” When the Public Counsel Unit opposes rate increases, it files expert testimony with the UTC. Utilities attempt to justify rate increases primarily by demonstrating increased costs, but those costs can be disputed. Ultimately, the UTC must approve all rate increases.

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“Washington families are struggling right now,” Ferguson said. “They do not need utility bills any higher than is absolutely necessary.”

PSE is requesting significant rate increases. Starting in January, over three years, PSE looks to raise electric rates by $405 million, and gas rates by $215 million. That’s an increase of about $16 per month for electric customers and $12 per month for gas to the average bill. The Attorney General’s Public Counsel Unit believes those increases are not fair, just, and reasonable.

Avista initially requested increases for electric rates totaling $70 million and $13 million for natural gas rates, over two years. Avista reached a settlement with several parties which reduced Avista’s requested rate increases for electric rates to $50.5 million, and gas rates to $9 million over two years. If granted, rate increases would hit utility bills as soon as December, and would raise customers’ average monthly electric bill by approximately $7 per month, and gas bills by approximately $1 per month.

Ferguson’s Public Counsel Unit filed expert testimony with the Utilities & Transportation Commission (UTC), asserting that in both cases, the utilities have not justified the extent of the rate increases they request.

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Among other issues, the AGO’s experts determined that both private utilities included higher profit margins in their proposals than were justified. PSE is asking to increase its profit to nearly 10 percent, while Avista is asking for 9.4 percent profit. The AGO’s experts determined those profits are too high.

The experts also determined that the utilities have overestimated many of their costs to provide power to their customers.

Instead, the unit asserts that PSE’s request is approximately $188 million too high over three years for electric rates and $112 million too high for natural gas rates.

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For Avista, the unit says the settlement provides rates over two years that are about $47 million too high for electric rates and $7 million too high for natural gas rates.

The UTC will host virtual public comment hearings in both cases. If you would like to let the UTC know your thoughts about either case, you may participate in the public comment hearings or submit comments to the Commission.

For Avista, the public comment hearing will be at 6 p.m. on Sept. 7. The public may participate through Zoom or phone. The Zoom link and phone participation information can be found on the UTC website at https//utc.wa.gov/220053.

For PSE, the public comment hearing will be at 6 p.m. on Sept. 28. The public may participate through Zoom or phone. The Zoom link and phone participation information can be found on the UTC website at https//utc.wa.gov/220066.

Comments may also be sent to the Commission by email at [email protected], by mail at P.O. Box 47250, Olympia, WA 98504, or by phone at 888-333-9882 (toll-free).

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