Idaho regulators accepted a long-range natural gas supply plan for Spokane, WA-based Avista Utilities, but asked the company to report back on how the state of Washington’s rejection of a gas purchase mechanism could impact the utility’s 60,000 gas customers in northern Idaho. At issue is a “benchmark mechanism” established by Avista for gas purchases for its service to three states — Oregon, Washington and Idaho.

Avista’s mechanism established a natural gas cost for the three states the first of every month based on an assumed volume purchase from each of three gas supply basins serving the Northwest, and a utility affiliate, Avista Energy, managed the program. The Idaho Public Utilities Commission is concerned that Washington’s refusal to adopt the program could raise gas costs for the retail customers in Idaho.

Last February, the Washington Utilities and Transportation Commission in a split decision determined that Avista’s benchmark mechanism didn’t provide enough safeguards for transactions between the two Avista companies — Utilities and Energy. In response, Avista Utilities proposed adding personnel to handle gas purchasing for the three states, including Idaho.

“The Idaho commission is asking Avista to supply it with copies of all benchmark mechanism transition documents submitted in the company’s other states and to address the regulatory consequences and economic and operational impacts in Idaho that will result from terminating the program,” said the PUC in announcing its action Monday.

Part of an overall integrated resource plan, Avista’s program includes gas/electric energy efficiency activities funded by a 0.5% tariff rider on customer bills, generating about $1 million annually in Idaho for gas efficiency and low-income consumers’ programs.

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