Electric customers in Santa Cruz and Mohave counties face a 14% increase in average residential rates next month as UniSource Energy Services aims for the first new rates in more than seven years.
On Wednesday, Jan. 17, the Arizona Corporation Commission is scheduled to consider UniSource's request for significant rate increases to cover system improvements and increased costs.
UES It serves approximately 19,000 customers in Santa Cruz County and approximately 80,000 customers in Mohave County.
Tucson Power's sister company filed for new rates in November 2022 that would increase annual retail revenue by $25 million, or 10.4%.
The company is seeking an increase of about 14%, or $18.52, or $19.71 per month, including excess fuel charges and surcharges for energy efficiency programs, on a base rate customer's average monthly home bill.
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UES also wants to increase the fixed monthly basic service fee for residential customers by $2 and to $17 for customers on basic rate plans, in order to recover more of its fixed costs.
After opposition from consumer advocates, the utility company will increase the base monthly rate discount for low-income rate plans from $16 to $20, more than offsetting the increase in service fees. proposed.
UES is also demanding a controversial “system reliability benefit.” This is a new fee that allows the company to begin recovering system improvement costs between fee cases. The utility says this will allow it to add new generation assets and reduce its current 40% dependence on wholesale power purchases.
The company cited a similar mechanism approved by the ACC several years ago to help small water companies replace aging infrastructure, but this was largely due to the high cost of filing rate litigation. This was to avoid costs.
The commission's Public Works Division staff and an administrative law judge recommended approval of the new charges.
But the state agency that represents residential ratepayers in rate lawsuits, the Department of Housing, Utilities and Consumer Affairs, said the ACC ruled in its rate decision last August that further investigation and stakeholder consultation was needed. The company opposes this charge, pointing out that TEP has rejected a similar charge.
The ACC Administrative Law Judge also recommended a return on equity of 9.6%, a key profit metric, which is lower than the company's requirement of 9.95%, but recommended by ACC staff and RUCO. Higher than standard.
UniSource's current electricity rates went into effect in mid-2016, and the company filed its pending rate case in November 2022.
UES spokesman Joe Barrios said the company delayed its rate application in 2020 due to the COVID-19 pandemic and because ACC asked for a plan to transition some bill surcharges to general rates. After additional time, it said it has postponed its fee application again in 2021.
The ACC is scheduled to decide on the UES interest rate issue at a special public meeting in Phoenix starting Wednesday at 9 a.m.
To view the meeting online, please visit: azcc.gov/live; To listen by phone, call 1-877-309-3457 and use passcode: 801972877##.
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Contact senior reporter David Wichner at dwichner@tucson.com or 520-573-4181. Twitter:@dwichner.
