Rate Increases Will Help Fund AMI

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The Idaho Public Utilities Commission has approved four rate adjustments: the annual power cost adjustment (10.2%), the energy efficiency rider (2.25%), money for the installation of automated meters (1.8%) and the annual fixed cost adjustment (1.3%).

Responding to a directive from the commission, Idaho Power has begun a three-year process to replace its existing meters with advanced metering infrastructure (AMI) that will eventually allow customers to monitor electric prices and adjust their use to take advantage of lower-price periods.

Idaho Power estimates the project will cost $71 million over its three year phase-in process. In this application, Idaho Power sought the first installment, or $11.2 million, for investments made between June 1, 2009, and May 31, 2010, which would have resulted in a 2.22% increase.

However, the commission adopted its staff's recommendation to include only costs through 2009, as more representative of the company's actual investment. The resulting increase is 1.8%.

‘We are confident that such an approach will provide the necessary protection to ratepayers and ensure that the company is able to maintain adequate cashflow and access to sufficient capital to maintain a secure financial footing in the midst of the current economic downturn,’ the commission said.

The Snake River Alliance filed comments supporting the company's application but acknowledged that the meters' benefits will not be realized immediately. However, ‘eventual benefits will lead to real energy savings that will benefit all customers â�¦ through reduced energy bills and reduced need for additional investments in generation and transmission.’

The commission is urging Idaho Power to ‘move forward with all deliberate speed,’ with installation beginning this year in the Boise, Idaho, area, in the Canyon and Payette regions in 2010, and, finally, in the Magic Valley, Pocatello and Salmon areas in 2011. Idaho Power is pursing federal stimulus dollars to help fund the project, which could eventually reduce ratepayer costs.

SOURCE: Idaho Public Utilities Commission

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