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Commission Turns Down PacifiCorp Rate Increase Request
 
May 14, 2001 (2001-020)
 
Contacts:  Ron Eachus, Chairman, 503 378-6611; Roger Hamilton, Commissioner, 503 378-6611; Joan H. Smith, Commissioner, 503 378-6611; Bob Valdez, Public Information Officer, 503 378-8962
 
Salem, OR – Today the Oregon Public Utility Commission denied a request by PacifiCorp to immediately raise its rates by 12 percent in order to offset the cost of high wholesale power costs. The Commission said it was a sizeable request with a high burden of proof on the company and
the company failed to provide sufficient justification to raise rates at this time.
 
The Company, in arguing for approval, said the extraordinary volatility of the wholesale power markets makes business as usual an unavailable luxury, noting the traditional "comfort zone" usually involves a ten-month, exhaustive rate case process.
 
"I am not comfortable that I have enough information to make a decision at this time on an increase of this size," Commissioner Roger Hamilton said. "We will continue to consider reasonable rate requests and price plans that reward consumers who reduce consumption and dependence on wholesale markets."
 
The company had requested the new rates take effect May 15, 2001.
 
Initially, the company requested an overall increase of $42.7 million, or 24.5 percent increase to be collected over three months, from May 2, 2001 through July 2001. When staff recommended it be denied the company asked for a two-week delay and submitted a scaled-down new request for $17.5 million, or 12 percent hike to be collected from May 15, 2001 through July 2001.
 
The PacifiCorp proposal was opposed by the Commission staff, the Oregon Citizens' Utility Board (CUB) and Industrial Customers of Northwest Utilities (ICNU). They argued the company had not provided factual support justifying the higher rates at this time.
 
Staff said it is simply not possible to tell if a rate increase would be just and reasonable.
 
In February the Commission agreed to allow PacifiCorp to raise rates by 3 percent in response to high power costs.
 
The Commission is reviewing a separate request from PacifiCorp to raise rates 15 percent with an August 1 effective date.
 
In addition, the Company is keeping track of excess power costs through a deferred accounting mechanism in order to recover costs at a later date. Current law allows the company to recover no more than 3 percent a year.
 
 
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