Average PSE customer will see higher electric, gas rates soon. Here’s why
Washington Utilities and Transportation Commission on Wednesday announced that Puget Sound Energy will be introducing new rates starting Oct. 1.
The new rates approved by the UTC are the result of a back-and-forth between PSE and UTC during the COVID-19 pandemic.
According to the UTC, “PSE’s average residential electric customer using 900 kWh a month will see a rate increase of 1.85 percent and can expect to pay $1.81 more, for an average monthly bill of $99.56.”
The average residential natural gas customer using 64 therms a month “will see a 0.73% increase and pay 52 (cents) more for an average monthly bill of $71.71,” it said.
The action came after PSE filed a petition in King County Superior Court in August 2020 seeking review of a commission ruling that ordered PSE to speed up the return of federal tax savings to customers.
PSE believed the UTC order violated IRS rules and the 2017 Tax Cuts and Jobs Act.
According to UTC, “The three-member commission previously approved customer rates in PSE’s 2020 general rate case, authorizing a revenue increase of approximately $102.5 million. The commission used a set of cost-saving measures to keep all but $31 million of those increases from customers’ bills for at least two years considering the financial hardships customers are facing because of the COVID-19 pandemic.”
On July 26 of this year, the IRS ruled that PSE could not return the tax credits as the commission had ordered, resulting in UTC amending its orders and Wednesday’s announced new rates.
“In a private letter ruling requested by PSE, the Internal Revenue Service determined that the return of the funds could not be fast-tracked without also making similar adjustments to the rate base because that would create inconsistencies prohibited by IRS rule,” the UTC said.
“In compliance with the IRS’ directive, the commission reversed its earlier ruling and authorized a revenue increase of approximately $122.4 million,” the UTC said Wednesday. “The commission again has used a set of cost-saving measures to keep all but $53.2 million of those increases from customers’ bills which results in an overall annual revenue increase of $31.6 million for electric and $7.9 million for natural gas.”
Andrew Padula is media engagement program manager Puget Sound Energy.
Padula, said in an emailed response to questions from the The News Tribune on Thursday, “We will continue to work with customers in need of help paying their bills. In addition to existing energy assistance programs, Home Energy Lifeline Program (HELP) and Warm Home Fund, PSE created specific COVID-Bill Assistance Programs in 2020 and 2021, providing an additional $30.1 million in assistance funds to help customers with their past due bills.”
The UTC earlier this year ordered five utilities, Avista, Cascade Natural Gas, Northwest Natural Gas, PacifiCorp and Puget Sound Energy, to create temporary COVID-19 bill relief programs, resulting in more than $40 million in assistance funds for customers.
The new rates come one day after the end of the state’s utility disconnection moratorium. Gov. Jay Inslee issued the moratorium in April 2020, banning energy, water and telecommunication companies from disconnecting customers because of nonpayment.
The moratorium was extended to Sept. 30 of this year.
The state Attorney General’s Office reported in early September that as of June, PSE had 191,925 customers with past due bills, out of the more than 280,000 customers behind in payments with the five investor-owned utilities in the state.
“That total number was similar to where it was in March 2020. However, in March 2020, people had past due amounts totaling just over $39 million. As of June, that number had more than doubled to over $80 million. Nearly $54 million of that total came from bills that were 90 or more days past due,” according to the AG’s Office.
PSE on Thursday noted that since the beginning of the pandemic, “all PSE programs have provided approximately $56 million in total assistance to more than 95,880 customers.”
“We understand that this has been a challenging time for our customers and our communities, and we have stood by our commitment to continue maintaining services to everyone who needs it,” said PSE president and CEO Mary Kipp in a statement issued Thursday. “With the moratorium ending, we are reaching out to customers and offering help through financial assistance and arranging payment plans to help them get back on track.”
More information on assistance programs is available on UTC’s website and at PSE.com/help.
PSE provides electrical service to more than 1.1 million customers across eight counties: Island, King, Kitsap, Kittitas, Pierce, Skagit, Thurston, and Whatcom. The utility also provides natural gas service to more than 800,000 customers in King, Kittitas, Lewis, Pierce, Snohomish and Thurston counties.
This story was originally published September 30, 2021 at 12:07 PM with the headline "Average PSE customer will see higher electric, gas rates soon. Here’s why."
