Electricity bills for Puget Sound Energy residential customers will increase by 3.2 percent while natural gas bills will rise by 1.3 percent as a result of action taken by state regulators today. New rates go into effect May 14.
The Washington Utilities and Transportation Commission is allowing PSE to raise electric rates by $63.3 million a year and $13.4 million for natural gas rates, substantially less than the $161 million and $32 million, respectively, the utility originally requested last June. The last PSE rate increase approved by the commission was two years ago.
The average PSE residential electric customer using 1,000 kilowatt hours-per-month will see their electric bill increase by $3.30, for a bill total of $102.56. The typical natural gas customer using 68 therms a month would pay $1.08 more, for a revised bill of $86.09.
On June 13, PSE filed a general rate case with the UTC requesting an annual $193 million overall rate increase for both electricity and natural gas service. The commission is ordering $76.7 million overall rate hike for both services.
The basic monthly service charge of $7.25 – paid by all residential customers regardless of the amount of electricity used – will increase by about 23 cents to $7.48. The basic service charge for residential natural gas customers will increase 50 cents a month, from $10 to $10.50.
Beginning Jan. 1, PSE electric customers will receive an annual bill credit for their share of the proceeds and benefits from the utility’s sale of surplus Renewable Energy Credits. Commonly called green tags, RECs are intangible assets that represent the right to claim the environmental attributes of a renewable generation project, such as a wind farm or the Cedar Hills Regional Landfill.
The average residential electric customer will receive a bill credit of about $8.28 a year. Additional revenue from REC sales will be included annually. A utility is required by state law to generate a certain percentage of its electrical output using renewable energy. If the company has excess generation from renewable resources it can sell the resulting RECs.
Among the major differences between the company’s request and the UTC order are significant reductions for power costs due substantially to the lower cost of natural gas and a reduction in the utility’s allowed return on its capital investments. The commission declared prudent PSEs decision to build the Lower Snake River Wind Project in Garfield County, which went into service Feb. 29. That project, designed to meet PSE’s legal obligation to serve a portion of its load with renewable energy, cost $770 million and has a generating capacity of 343 megawatts.
Bellevue-based Puget Sound Energy serves 1.1 million electric customers and 756,765 natural gas customers in parts of Snohomish, King, Pierce, Lewis, Thurston and Kittitas counties.