SENATE BILL REPORT

SB 6438

BYSenators Benitz, Stratton, Newhouse, Bluechel, Owen, Nelson, Pullen, Madsen, Williams and Talmadge

Permitting banded rate tariffs for natural gas and electric services.

Senate Committee on Energy & Utilities

Senate Hearing Date(s):January 22, 1988; January 26, 1988

Majority Report:  That Substitute Senate Bill No. 6438 be substituted therefor, and the substitute bill do pass.

      Signed by Senators Benitz, Chairman; Bluechel, Vice Chairman; Madsen, Newhouse, Owen, Pullen, Williams.

Senate Staff:Paul Parker (786-7455)

                  January 26, 1988

AS REPORTED BY COMMITTEE ON ENERGY & UTILITIES, JANUARY 26, 1988

BACKGROUND:

Natural gas and electric utilities face increasing competition for industrial and agricultural customers.  Although the Utilities and Transportation Commission has approved utility requests for lower rates where necessary to prevent fuel- switching between customers, utilities seek more flexibility to better respond to such factors as fluctuating oil prices.

SUMMARY:

The UTC is authorized to allow rate flexibility for nonresidential service provided by energy utilities.  After the UTC approves a band or range of rates, with a minimum and maximum rate, the company may change rates within the band according to UTC procedure.

EFFECT OF PROPOSED SUBSTITUTE:

Bonded rates are allowed only where utilities are subject to effective competition from energy suppliers not regulated by the UTC.

Appropriation:    none

Revenue:    none

Fiscal Note:      none requested

Senate Committee - Testified: Steve McLellan, UTC; Ron Newbry, Pacific Power; Scott Nelson, Washington Natural Gas; John Stefani, Washington Natural Gas; Chuck Adams, AAG