Power cost adjustment impacts new Puget Sound Energy rates
Customers will see additional increase to rates
Lacey, Wash. – This week, state regulators approved a power cost adjustment for Puget Sound Energy, resulting in an additional increase to the rates approved last month.
In December, the Utilities and Transportation Commission approved multiple settlements in PSE’s request for increased rates through a multi-year rate plan. The plan covers two years, beginning Jan. 1, 2023. In that order, the commission approved an electric revenue increase of $223 million on Jan. 1, 2023, followed by an additional increase of $38 million on Jan. 1, 2024; and a natural gas revenue increase of $70.6 million on Jan. 1, 2023, and by $18.8 million on Jan. 1, 2024.
The commission approved settlement also allowed the company to update its forecasted power costs in a subsequent compliance filing. In that compliance filing, the commission approved a $30.7 million adjustment to power costs for year one of the rate plan approved last month.
The increase reflects the impact of updated natural gas prices and the costs of completed hedge contracts.
As a result of both the approved settlements and the power cost adjustment, the typical residential electric customer using 800 kWh of energy per month can expect a total increase of about $8.73 per month in 2023 and an additional $1.48 in 2024.
The typical natural gas residential customer using 64 therms per month can expect a total increase of about $4.87 per month in 2023 and an additional $1.34 per month in 2024.
These new rates for electric service went into effect on Jan. 11. The new rates for gas service went into effect on Jan. 7.
PSE’s initial compliance filing sought to recover an additional $166.5 million in power costs, including $135.8 million related to its modeling of Climate Commitment Act impacts. After review, the commission ordered PSE to resubmit its compliance filing to reflect only $30.7 million related to natural gas prices and hedge contract costs.
The company may elect to defer the $135.8 million in projected power costs related to the Climate Commitment Act and may submit a request for recovery of those costs either in its 90-day compliance filing for 2024 forecasted power costs or file a petition for Commission review of these costs in a separate proceeding.
Bellevue-based PSE provides electricity service to more than 1.1 million electric customers in eight Washington counties: Island, King, Kitsap, Kittitas, Pierce, Skagit, Thurston, and Whatcom. PSE also provides natural gas service to more than 800,000 customers in six Washington counties: King, Kittitas, Lewis, Pierce, Snohomish, and Thurston.
The UTC is the state agency that regulates private, investor-owned electric and natural gas utilities in Washington. It is the commission’s responsibility to ensure regulated companies provide equitable, safe, and reliable service to customers at reasonable rates, while allowing them the opportunity to earn a fair profit.