Case No. CAP-W-06-01, Order No. 30198

December 13, 2006

Contact: Gene Fadness (208) 334-0339




Commission approves rate increase for Capitol Water customers


The Idaho Public Utilities Commission today approved an average 31.3 percent rate increase for customers of Capitol Water Corp. of Boise. The company serves about 2,875 households in the west bench area. The new rates are effective Jan. 1, 2007.


Capitol Water said the increase is necessary to implement capital improvements such as well and customer service line replacements. Capitol originally sought an effective date of Aug. 1, but the commission suspended that date to allow time for commission staff to audit general ledger accounts and supporting vouchers and invoices and verify physical plant and property. Staff also conducted a public workshop and solicited written comments.


The rate increase adds $148,908 to annual revenues for a total annual revenue requirement of $624,713. The revenue requirement includes an authorized 12 percent rate of return on equity.


For the majority of customers who are not on meters, the monthly flat rate increases from $8.65 to $10.57 for customers on a ¾” pipe. Monthly rates gradually increase for customers with a larger pipeline capacity. For metered customers, the increase on the minimum monthly charge is from $5.54 to $7.70 for use up to about 5,200 gallons. The rate gradually increases for consumption beyond that point.


The commission decided against requiring that all customers be metered. The cost to install meters could be as high as $1.5 million resulting in a 35 percent or greater impact on customer rates. After consulting with the Idaho Department of Water Resources, commission staff concluded that while consumption by the company is significantly higher on an annual basis than surrounding water companies, it does not adversely impact the aquifer.


The commission denied the company’s request to extend the summer billing period by one month to include April. The current summer billing period is May through September. The commission said including April in the higher summer rates would not be consistent with other water companies in the area. The company’s power consumption and energy use did not demonstrate that April’s use was comparable to that from May to September. In fact, the company’s water use is substantially less during April than in the summer months.


The commission made some other minor adjustments to the company’s revenue requirement in relation to the company’s use of vehicles and its water testing expenses. Existing surcharges for power and chemical expenses were ordered to be included in base rates rather than in surcharges.


A full text of the commission’s order, along with other documents related to this case, are available on the commission’s Web site at Click on “File Room” and then on “Water Cases” and scroll down to CAP-W-06-01. Interested parties may petition the commission for reconsideration by no later than Jan. 3, 2007. Petitions for reconsideration must set forth specifically why the petitioner contends that the order is unreasonable, unlawful or erroneous. Petitions should include a statement of the nature and quantity of evidence the petitioner will offer if reconsideration is granted.


Petitions can be delivered to the commission at 472 W. Washington St. in Boise, mailed to P.O. Box 83720, Boise, ID, 83720-0074, or faxed to 208-334-3762.