State seeks to limit Puget Sound Energy’s gas rate hike

The state office representing utility consumers recommends that Puget Sound Energy’s proposed increase for natural gas rates be severely reduced.

Instead of adding $237 million annually to revenue through the rate hikes for both gas and electricity, the Public Counsel Section of the Washington State Attorney General’s Office said Friday PSE should be limited to raising $11 million more per year.

“PSE’s request is much larger than the evidence supports is necessary to cover costs,” Simon ffitch, chief of the Public Counsel Section, said in a written statement. “PSE’s customers have been hit hard recently with frequent rate hikes — it’s important that this increase be no more than absolutely necessary.”

“The rate request does reflect our actual cost of doing business,” PSE spokeswoman Dorothy Bracken said. She said the utility, like consumers and other businesses, faces rising costs for a wide variety of the services and materials it uses. “No one likes higher rates, but costs are going up everywhere.”

The testimony from the public counsel’s office is part of the rate request process. The Washington Utilities and Transportation Commission is expected to decide on the request by November.

Bellevue-based PSE’s request asks to increase natural gas rates by about 6 percent, or about $5, per month. It also wants to boost electricity rates by nearly 10 percent, though that does not affect Snohomish County, which is served by the Snohomish County Public Utility District.

Much of the increase would come from raising the basic monthly fee for all natural gas customers from $8.25 to $18 per month.

PSE argues it needs the rate changes to help pay for improvements to its infrastructure.

The public counsel’s office, however, urges the utilities and transportation commission to reject PSE’s proposal to increase the fixed monthly charges to customers.

Additionally, ffitch’s office argues in its testimony that some of PSE’s expenses covered by ratepayers are more frivolous than “infrastructure.” For example, costs for executive parking at Seattle-Tacoma International Airport or for PSE’s corporate suite at Safeco Field are covered by ratepayers, according to the office’s testimony.

While those costs represent relatively few dollars, “there’s a principle here,” ffitch said. His office’s testimony also argues that PSE’s profit margin should be limited to just more than 9 percent, rather than increased, and that pay for the utility’s top executives should be cut.

The public counsel’s office did not file testimony on PSE’s proposed sale to a group of Canadian and Australian investors. The office is expected to weigh in on that issue next month.

Bracken added that PSE will look over the testimony from the public counsel’s office and other interested parties that filed on Friday and issue its rebuttal testimony by the end of next month.

Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.

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