Rate Adjustments Increase Average Monthly Idaho Power Bills 

click to enlarge ADAM ROSENLUND
  • Adam Rosenlund

With temperatures already climbing toward the 90s and what could be record-setting heat this weekend, homeowners will be keeping a closer eye on their power bills, given our increasing dependence on air conditioning. With that in mind, residents woke up to the news Wednesday morning that the state's largest utility was raising its rates.

Effective June 1, Idaho Power announced it was making two adjustments—both upward—to its rates. In total, it results in an approximate 3.5 percent increase for the average customer, amounting to a total of about $3.48 a month.

The Power Cost Adjustment is an annual adjustment—it can go up or down—to compensate for Idaho Power's "power supply costs." Utility officials said the higher PCA was due to, No. 1: increased PURPA generation, referring to the government-mandated purchase of more alternative energy sources; No. 2: less revenue sharing with customers due to a lower return on equity in 2015; No. 3: lower-than-projected hydroelectric generation; and No. 4: lower-than-forecasted wholesale market prices for electricity, resulting in lower sales volumes for Idaho Power when it sells its surplus power to the open market.

As a result, this year's Power Cost Adjustment was set at an additional 1.35 percent, representing an increase to the average residential bill of about $1.32 per month.

The Fixed Cost Adjustment allows Idaho Power to recover its fixed costs of delivering energy when energy sales decline due to reduced consumption. The Idaho Public Utilities Commission approved an FCA increase of 2.2 percent, representing an increase to the average residential bill of about $2.16 per month.
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