BOISE, Idaho, March 23 /PRNewswire-FirstCall/ -- IDACORP, Inc. subsidiary Idaho Power today released preliminary figures that show this year's improved stream flows will likely result in a double digit rate reduction June 1, but the company cautioned that a proposed bill to reallocate Idaho Power water rights to aquifer recharge would threaten this customer benefit in the future.
Although Idaho Power is still finalizing its annual Power Cost Adjustment (PCA) filing with the Idaho Public Utilities Commission (IPUC), the company calculates the benefits of this year's healthy snow pack in the Snake River drainage should reduce rates approximately 12 percent from current levels.
The company issued this preliminary assessment today to provide the public information about the potential impacts of House Bill 800. The bill has passed the Idaho House of Representatives and is awaiting consideration by the Senate. The bill would subordinate Idaho Power's water rights for hydroelectric generation, or make them secondary to, aquifer recharge. The practice would divert flows from the Snake River and potentially prevent all but specified minimum river flow levels from passing through the company's system of hydroelectric dams.
"The rate reduction clearly shows the value to our customers of protecting the hydroelectric system," said Idaho Power President and Chief Executive Officer LaMont Keen. "High water years produce a very real benefit for our customers because more low cost electricity is produced at our hydroelectric dams. Customers realize these benefits through low base rates, and in improved water years like this one, actual rate reductions.
"The proposed bill threatens such benefits in the future. By taking the higher Snake River flows and diverting them to the desert rather than allowing them to flow through the power turbines, less low-cost electricity will be produced. This stream flow diversion could reverse this year's reduction in future years and drive rates up in all years."
House Bill 800 would amend an Idaho law unanimously approved in 1994 that specifically protected hydroelectric generation water rights from being subordinated to aquifer recharge, which was designated for the first time that year as a beneficial use of water. Aquifer recharge is the practice of diverting water from the Snake River into the southern Idaho desert in the hope of partially replacing water being removed, largely by irrigation pumping.
Under Idaho Power's PCA process, the company in mid-April each year files with the IPUC its calculation of how rates should be adjusted to reflect fluctuations in snow pack and stream flow conditions. The IPUC reviews the company's filing and audits the company's records before issuing an order in time for rates to be adjusted each June 1. The PCA is designed to ensure the company and its customers share in both the benefits of good water years and the costs of low water years. In the 14 years since the PCA was introduced, which includes six drought years, the mechanism has resulted in rate reductions six times and rate increases eight times.
