Agenda Date: November 30, 1999
Item Number: 

Docket:  UE-991606 and UG-991607
Company:  Avista Corp.

Staff:   Mike Parvinen, Policy Research Specialist
   Assigned Rate Case Team

Recommendation:

Issue a complaint and order suspending the filings in Dockets UE-991606 and 
UG-991607 and set the matters for hearing.

Discussion:

On October 22, 1999, Avista Corp. filed general rate increases for its electric 
and natural gas operations with effective dates of December 1, 1999, and 
January 1, 2000, respectively.  The proposed revenue increases are $26,253,000 
(10.4%) for electric and $4,899,000 (6.5%) for natural gas.

Background:

The company’s last general rate filings were July 1, 1990, for electric and 
January 1, 1998, for natural gas.  In the current filings the company is 
requesting a return on common equity of 12.25% with an overall rate of return 
of 9.93%.  The company serves approximately 204,000 electric and 118,000 
natural gas customers in the Spokane area.

To date, the Commission has received 78 letters opposed to the increase in 
rates for both gas and electric services by Avista.  Customers believe the 
rates are high enough for electric and gas services.  Customers believe the 
proposal is outrageous and believe the company should look for methods to 
tighten its operational budget.  Some customers stated that they are on a fixed 
income and will not be able to afford the proposed increases.  Customers have 
requested that this proposal be scrutinized very closely and some have agreed 
that a small increase may be warranted. 

Summary:

The proposed effects of the electric and natural gas filings would result in 
revenue increases for the following customers classes:

Dockets UE-991606 and UG-991607
November 30, 1999
Page 2

 
 Electric:          Annual  Percent
           Revenue     Change
Residential       $14,500,000   14.0%
Small Commercial          1,740,000     7.0%
Medium - Large Commercial & Industrial      5,802,000     7.9%
Large Commercial & Industrial        3,345,000   12.6%
Agriculture & Other Water Pumping          516,000   12.0%
Street & Area Lighting            350,000     9.8%
Total        $26,253,000   10.4%

 Natural Gas:         Annual  Percent
           Revenue     Change
Residential and Small Commercial - Firm    $3,833,000     7.5%

Large General Service - Firm           760,000     4.4%
Large General Service - High Annual 
  Load Factor - Firm            128,000     4.6%
Interruptible Service                       0        0%
Transportation Service            178,000     8.6%
Transportation Service - High Volume                    0        0%
Total          $4,899,000     6.5%

Staff’s recommendation is to issue a complaint and order suspending the filings 
in Dockets
UG-991606 and UG-991607 and set the matters for hearing.