Jessica M. Karmasek Jun. 24, 2013, 1:32pm

SEATTLE (Legal Newsline) -- Washington Attorney General Bob Ferguson is challenging electric rate increases proposed by PacifiCorp, which operates in the state as Pacific Power and Light Company.

The Portland-based utility is requesting rates that would generate an additional $42.8 million in revenue from its Washington electric customers.

Ferguson said the rate request is too high.

"The Attorney General's Office advocates on behalf of consumers in utility rate cases," he said in a statement late Friday.

"PacifiCorp operates in six states, so the Attorney General's Office wants to ensure that Washington customers are paying costs associated with Washington operations."

Assistant Attorney General Lisa Gafken said the office is particularly concerned with the utility's proposal to increase customer reconnection fees.

"The increase is double or more than double the current charge, depending on the specific fee," she said. "These fees are generally borne by the most vulnerable of PacifiCorp's customers, and the company's proposal would unnecessarily burden these customers, making reconnection more difficult."

On Friday, the public counsel division of Ferguson's office filed expert testimony that analyzes a number of elements of PacifiCorp's proposal.

Highlights of the testimony include recommendations that the Washington Utilities and Transportation Commission, or UTC:

- Reject modifications to the company's reconnection fees and permanent disconnection fees;

- Reject the company's request to increase the customer charge by 67 percent, raising the basic monthly charge customers pay from $6 to $10 per month. Public Counsel recommends a smaller increase;

- Remove the $10.7 million costs associated with purchasing power from about 60 small generators in Oregon and California because those small generators produce electricity that primarily serve their local markets;

- Reduce labor costs and executive compensation to reflect lower employee numbers and to bring executive compensation in line with market averages; and

- Accept the company's proposal to measure certain costs closer to the time when rates would take effect as a way to reduce lag in cost recovery.

Ferguson said if the UTC accepts his adjustments, PacifiCorp's electric rate request would be reduced by nearly $23 million.

Other parties, such as commission staff or the Industrial Customers of NW Utilities, may recommend additional reductions in other areas, the attorney general noted.

PacifiCorp will have an opportunity to file rebuttal testimony addressing the attorney general and other parties' recommendations.

In addition, the UTC will hold two public comment hearings next month, in Yakima and Walla Walla.

Hearings then will be held in late August, and a commission decision is expected no later than December.

In March 2011, the UTC authorized a rate increase of about $38 million, and in June 2012, PacifiCorp was authorized to raise its rates by another $4.5 million.

The company serves about 132,000 electric customers in Yakima, Walla Walla, Garfield and Columbia counties.

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