State nixes rate hike for PSE
June 25, 2008 · Updated 12:53 PM
South Whidbeys electricty budgets are safe for the rest of this year.
Puget Sound Energys hopes of receiving an $84 million cash infusion before the end of the year were squashed last week when the state Utilities and Transportation Commission told the company it will not get an emergency rate increase.
Last Thursday, the three UTC commissions voted in Olympia to dismiss an emergency rate case PSE filed in late August. In the case, PSE asked the UTC to increase electricity rates for its customers by 1.073 cents per kilowatt hour. The increase would have earned the company $84 million, an amount equal to one percent of PSEs annual electricity revenues.
Tim Sweeny, a spokesman for the UTC, said Tuesday that the case came to an abrupt conclusion when the agencys commissioners ruled on a motion to dismiss the case introduced last month by attorney Simon ffitch.
Sweeny said the commissioners had to decide whether the company was in financial peril due to losses it claimed to sustain due to the recent collapse of wholesale electricity prices. In their opinion, Sweeny said, the utility was in no danger.
However, PSE may still win a rate increase sometime during the next year based on a general rate case the utility officials say they will file this fall. Sweeny said that case could succeed.
The decision in no way reflects on whether the company is deserving of a rate increase, he said.
PSE spokesman Karl Kirn said the UTCs dismissal of his companys emergency rate increase was not completely unexpected. It wasnt good news either.
Were disappointed, he said.
A higher electricity rate this year would have put a pinch on Whidbey Island cities and schools. Langley Mayor Lloyd Furman said that while the city is dodging a bullet this year, it is still budgeting for a price increase next year.
We are going to budget for more than 18 percent, he said, referring to the 1.073 cent increase presented in PSEs rate case.
South Whidbey School District also reacted with concern to PSEs emergency rate increase request, which is now a moot point.
PSEs electricity rate will remain at 5.1 cents per kilowatt hour until the UTC approves an increase. Kirn said it could take until next November for the agency to decide on a general rate increase.