While Rocky Mountain Power requested an increase in their rate of return from 9.8% up to 10.2%, the PSC decreased their rate of return to 9.65%. To put that in context, even though the PSC approved higher electricity rates overall, a smaller percentage of the money RMP collects will go into shareholder’s pockets. Expenses incurred by the utility are passed through to customers, so having a set rate of return is a way to ensure the utility earns a return on their investment without over-charging customers for electricity. In approving a lower revenue requirement, the PSC did not include certain costs that RMP requested, including the costs of installing Advanced Metering Infrastructure.Ĭommission Reduces Rocky Mountain Power’s Return on EquityĪ utilities’ rate of return on equity is what drives their profitability. The PSC did approve an increase, albeit a much smaller amount of $31.41 million. RMP requested to increase the amount of money they can spend and be reimbursed for annually by $95.8 million dollars. In order to receive reimbursement for the expenses incurred to build and maintain the grid and serve customers, the utility must demonstrate that their costs are prudently incurred and spent on resources that are used and useful. Increase Approved for Return on Investments But, for those ambitious readers eager to dive into the weeds, read on for the outcome of the 2020 Rate Case!
The results have a broad range of impacts that we can’t begin to cover in their entirety, but particular issues of interested to UCE include not only electricity rates, but also EV charging, the Subscriber Solar program, and energy conservation.īe warned, there is no easy or quick way to unpack all of the details. In order to prevent the utility from abusing this monopoly, Utah’s Public Service Commission must approve any and all changes to the utility’s rates. For the first time in more than five years, Rocky Mountain Power proposed to revise its rates for Utah customers, thereby launching a mammoth proceeding, “The Rate Case” that recently wrapped up. They are a monopoly that serves over 1 million customers in the West.
Rocky Mountain Power is unlike most businesses in that they aren’t subject to competition.
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