PUC Approves Lower Than Requested Rate Increase for PGE Customers

Posted on April 28, 2022

Additional adjustments further impact customer rates effective May 9

SALEM, Ore. –The Oregon Public Utility Commission (PUC) recently concluded its nearly year-long review of a request by Portland General Electric (PGE) to increase its overall rates by $59 million annually. The PUC significantly reduced PGE’s request and authorized the utility to collect an increase to its overall rates of $10 million annually, or 0.5 percent, to cover the costs of its general operations. With this decision, combined with separate automatic rate adjustments to recover costs for energy storage and transportation electrification programs and the early retirement of the Colstrip coal-fired generation facility, residential customers will experience an overall average bill increase of approximately 3.6 percent effective May 9, 2022.

In a rate case, the PUC must determine how much overall revenue the company is entitled to receive. A utility’s revenue requirement is determined on the basis of the utility’s reasonable and prudent costs. The PUC must also allocate the revenue requirement among the utilities customer classes – residential, business, and industrial customers.

PGE’s rate increase request was driven by capital investments placed in service since their last rate case, expansion of wildfire mitigation and vegetation management programs, as well as increased operating costs. The capital investments in the original filing included the new Integrated Operations Center, phase one of the Advanced Distribution Management System, as well as numerous transmission and distribution investments. The PUC also adopted the request by residential and large business customer advocates to potentially pass back to customers costs included in rates for the coal-fired Boardman generation facility collected after the plant was shut down in 2020. The amount of any potential refund will be subject to a review of PGE earnings in 2020, 2021 and 2022.

“PGE’s rate case filing was heavily scrutinized by customer advocate groups and PUC staff to ensure that Commissioners had the information we needed to make decisions in the best interest of customers,” said Megan Decker, PUC Chair. “That scrutiny led to a significant reduction in the amount approved to increase rates.”

PGE’s requested rate increase included significant wildfire mitigation and vegetation management costs to continue hardening the system in response to the growing wildfire risk in Oregon. These costs are subject to reporting requirements and tracking to ensure the increased funding is used for these essential programs. The PUC also adopted a framework to address recovery of costs from the 2020 Labor Day wildfires and the February 2021 ice storm, defining how those costs are shared between customers and PGE.

“An important element of the approved funding allows PGE to improve wildfire resilience, including maintaining vegetation standards around utility lines to help keep Oregonians safe as wildfire risk continues to evolve,” added Decker.

View Order 22-129 for details on the process and actions taken during this rate case proceeding.

PGE serves approximately 900,000 customers in seven counties and 51 cities in Oregon.

The PUC regulates customer rates and services of the state’s investor-owned electric, natural gas and telephone utilities, as well as select water companies. The PUC’s mission is to ensure Oregon utility customers have access to safe, reliable, and high quality utility services at just and reasonable rates.

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