BOISE, Idaho (AP) -- Idaho Power Co. asked state regulators Monday for approval to hike residential electric rates by 8 percent this year to help make up for revenue that failed to meet projections.
The company's proposal seeks permission to raise rates starting in June to generate nearly $88 million this year and another $52.5 million in 2014. The increase, part of annual power cost adjustments afforded to all utilities operating in Idaho, would impact customers across the spectrum, from residential ratepayers to irrigators and companies big and small.
It would be the biggest midyear adjustment since 2002, when Idaho Power raised rates to collect $244.4 million.
Under the company's proposal, residential customers would pay an additional 8.03 percent for electricity this year -- or an extra $7.28 a month for the typical customer. Customers would pay an extra 4.5 percent in 2014.
Irrigators would be hit with a 9.65 percent increase this year and would pay 5.7 percent more in 2014.
Idaho Power executives say the rate adjustment is necessary because of two factors that caused the company's revenues to fall more than $140 million below projections. Officials say low stream flows last year led to a 19 percent reduction in power generated by the utility's network of hydroelectric dams, with output totaling 1.8 million megawatts less than anticipated.
Greg Said, vice president of regulatory affairs, said cheaper energy prices on the open market also led to an unanticipated, 44 percent decline in projected revenue from the sale of surplus electricity.
"Last year when we filed our rates, we anticipated near normal stream flows," he said. "We didn't have that later in the year. We also had less surplus power to sell and the market for that surplus was down significantly."
The Idaho Public Utilities Commission has 45 days to review the proposal. The PUC allows Idaho Power, Rocky Mountain Power and Avista Inc., to adjust power costs midyear, but only as a revenue recovery tool, meaning revenue from an adjustment cannot passed on to shareholders.
If regulators approve the proposed increase, rates would return to their base levels after 2014. Officials say the Idaho Power, which serves more than 416,000 residential customers across the state, does not intend to file for a general rate increase this year.