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Avista’s proposed tax customer credit results in no rate change for customers effective Oct. 1, 2021 while providing Avista with necessary cost recovery
SPOKANE, Wash., Sept. 28, 2021 (GLOBE NEWSWIRE) -- Avista’s (NYSE: AVA) electric and natural gas general rate cases have concluded, with an order from the Washington Utilities and Transportation Commission (Commission or UTC) that approved the partial, multi-party settlement filed in June 2021, resolves all other remaining issues, and that will keep rates reasonable for customers.
Based on Avista’s proposal in its original filing, the Commission used certain Tax Customer Credits to fully offset, for a two-year period, the base revenue increases it approved for the Company. In the end, customers billed rates will not change as a result of this case.
The Commission approved base revenue increases of $13.6 million for electric operations, which reflects $30.6 million of power supply reductions, and $8.1 million for natural gas operations. Overall, the Commission’s order approved recovery of capital additions including investments in advanced metering infrastructure, wildfire resiliency, joining the Western Energy Imbalance Market, and other important projects. The Commission approved recovery for all capital investments included by Avista in this case, with the exception of certain Colstrip-related costs. In addition, the Commission did not allow recovery of certain expenses for 2021 and 2022.
The Commission approved a rate of return (ROR) on rate base of 7.12%, with a common equity ratio of 48.5% and a 9.4% return on equity (ROE).
"We are pleased with the Commission's decision in this case as it supports Avista’s ongoing investments in the infrastructure that serves our customers without immediately impacting customer bills,” said Avista President and CEO, Dennis Vermillion. “This is a constructive outcome that offers us the opportunity to continue to provide our customers with safe, reliable and affordable energy. The Company is disappointed not all of its expenses were approved for recovery at this time, and that the Commission did not agree with Avista’s share of investment in SmartBurn technology at the Colstrip Generating Facility, an investment we believe was prudent and in the best interest of our customers and the environment. We look forward to our next general rate case filing where we will have the opportunity to utilize recent legislation to further reduce the lag in cost recovery, and keep us on a path towards earning our authorized returns in 2023.”
About Avista Corp.
Avista Corp. is an energy company involved in the production, transmission, and distribution of energy as well as other energy-related businesses. Avista Utilities is the operating division that provides electric service to 400,000 customers and natural gas to 367,000 customers. Its service territory covers 30,000 square miles in eastern Washington, northern Idaho, and parts of southern and eastern Oregon, with a population of 1.6 million. Alaska Energy and Resources Company is an Avista subsidiary that provides retail electric service in the city and borough of Juneau, Alaska, through its subsidiary Alaska Electric Light and Power Company. Avista stock is traded under the ticker symbol "AVA." For more information about Avista, please visit www.avistacorp.com.
This news release contains forward-looking statements regarding the company’s current expectations. Forward-looking statements are all statements other than historical facts. Such statements speak only as of the date of the news release and are subject to a variety of risks and uncertainties, many of which are beyond the company’s control, which could cause actual results to differ materially from the expectations. These risks and uncertainties include, in addition to those discussed herein, all of the factors discussed in the company’s Annual Report on Form 10-K for the year ended Dec. 31, 2020 and the Quarterly Report on Form 10-Q for the quarter ended June 30, 2021.
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