Higher market costs in 2022 prompt price increase request for Rocky Mountain Power customers
BOISE, Idaho (KIFI) — Rocky Mountain Power’s costs for fuel and wholesale electricity increased in 2022 because of higher energy market prices, which made purchased power to serve its customers more expensive. As part of an annual review of these costs, the company requested an average 1.7% price increase for Idaho residential customers. A typical residential customer using 783 kilowatt-hours per month would see a 1.6% increase of about $1.57 per month on their electricity bill.
“We recognize that in difficult economic conditions, a price increase is not good news,” said Tim Solomon, regional business manager for Rocky Mountain Power in Rexburg. “Despite these difficulties, we remain committed to bringing the best value to our customers for their hard-earned dollars. We’ve worked diligently to keep our expenses low. We are strict with our budgets and continue our work to steadily improve our system to enhance reliability for our 89,365 customers in southeastern Idaho. We know how important reliable service is for business and homes alike. The energy costs in the annual adjustment are generally beyond the company’s direct control. This annual adjustment makes sure Rocky Mountain Power customers always pay a fair price for the energy they need.”
Extreme weather conditions in 2022 increased the costs of fuel and purchased power on the wholesale market—two of the main components of the company’s annual power cost adjustment. Multiple heat waves across Rocky Mountain Power’s service area in July, August and September significantly increased market prices. Increases in wholesale power prices during those months accounts for nearly half of total cost adjustment requested.
“The continuing drought in the West that began in the summer of 2020 has continued to impact the company’s power costs because it reduces the availability of our hydroelectric resources,” said Jack Painter, net power cost specialist for the utility. “Additionally, December 2022 saw a historic winter cyclone event across most of the United States, increasing both wholesale power prices and natural gas prices along due to increased demand. Natural gas prices across the region drastically rose—more that 400 percent at major delivery points last December, compared with 2021.”
The annual energy cost adjustment mechanism is designed to track the difference between the company’s actual expenses for fuel and electricity purchased from the wholesale market, against the amount being collected from customers through current rates. During the past year, the company’s energy-related expenses have increased by $32.2 million. Pending commission approval, the changes would take effect June 1, 2023, with the following impact on each rate schedule:
- Residential Schedule 1 – 1.6% increase
- Residential Schedule 36 – 1.9% increase
- General Service Schedule 6 – 2.3% increase
- General Service Schedule 9 – 2.9% increase
- Irrigation Service Schedule 10 – 2.1% increase
- General Service Schedule 23 – 2.0% increase
- General Service Schedule 35 – 2.2% increase
- Public Street Lighting – 1.1% increase
- Tariff Contract 400 – 3.0% increase
The public will have an opportunity to comment on the proposal as the commission studies the company’s request. The commission must approve the proposed changes before they can take effect. A copy of the company’s application is available for public review on the commission’s website, www.puc.idaho.gov, under Case No. PAC-E-23-09. Customers may also subscribe to the commission’s RSS feed to receive periodic updates via email. The request is required to be available at the company’s offices in Rexburg, Preston, Shelley, and Montpelier, although the company urges customers click HERE.
