The Idaho Public Utilities Commission has approved two applications submitted by Avista Utilities that will change the rates customers pay for natural gas.
According to a press release, Avista asked the commission for approval to adjust the fixed cost adjustment rates and approval to change purchased gas cost adjustment, also known as PGA rates. The fixed cost adjustment rate is a rate adjustment mechanism designed to separate the link between the energy a utility sells and the revenue it collects to recover fixed costs of providing service, which decouples Avista’s revenues from customers’ energy usage. The decoupling removes a utility’s incentive to increase sales to increase revenue and profits and encourages energy conservation.
The approval of the fixed cost adjustment rate application will reduce residential customers’ rates by 0.2 percent and represents a rebate of 1.219 cents per therm. Non-residential customers will see a decrease of 1.2 percent, which represents a rebate of around 63 cents per therm.
The purchase gas cost adjustment is a commission-approved mechanism that adjusts rates up or down to reflect changes in Avista’s costs to buy natural gas from suppliers, including changes in transportation, storage and other related costs. The approval of the adjustment will increase residential customers’ rates by $3.54, or 4.7 percent per month. Other groups of customers also will see an increase in rates.
