SALT LAKE CITY — Rocky Mountain Power continues its work to supply the growing demand of Utah customers for electricity, meet increasingly high summer peak electricity needs and to build a secure energy future for its customers and Utah’s economy.

As a result of this effort, the company has proposed an overall price increase of 11.3 percent to be effective in August 2008. This represents the increase in costs to the company over a two-year period. The request would translate to an increase of approximately $4.50 per month on average for a typical residential customer using 767 kilowatt-hours, if approved as requested.

The major factors driving the request are the large investments needed to provide electric service to customers and the rising cost of generating and purchasing electricity. Projections indicate that capital investments will approach $2.8 billion, or 40 percent above that reflected in current prices. As well, costs of generating and purchasing electricity top $1 billion – up 34 percent from costs reflected in current prices. The total amount of the company’s Utah request is $161 million.

"Rocky Mountain Power connects some 22,000 new customers every year," said Richard Walje, president, Rocky Mountain Power. "An increase in prices is essential to maintain and expand our systems for existing customers, provide for new customers and secure new generation and transmission resources for the future," he said.

"We recognize price increases affect all our customers because we see how those same types of price increases affect our business," Walje said. "The most difficult decision for any business is the decision to raise prices. This is especially true for so vital a commodity as electricity. We do not take the request for price increases lightly.

"Still, our electricity prices remain a significant value when compared to other goods and services. Even with this increase, our prices will be among the lowest nationwide," Walje noted. The Edison Electric Institute’s June 2007 national survey of average electric prices shows that even with these proposed price increases, Rocky Mountain Power will remain among the lowest-cost electric service providers in the United States.

"We believe we’ve done an excellent job of containing costs in recent years, especially in those areas where we have direct control," Walje said. "Our customers expect nothing less from us."

Contrary to the significant price increases experienced by customers of many other regional electric and gas utilities, Rocky Mountain Power has managed its costs in such a way that prices in Utah declined through much of the 1990s and have increased much more slowly than most other goods and services. As a result, the company’s proposed overall average electric price in this filing, without adjusting for inflation, will equal the company’s overall average price paid for electricity in the mid-1980s.

"The proposed level of return is more in line with the company’s present business risks related to our large capital investment program, which is required to properly serve our customers," Walje said. "As well, there is significant uncertainty about how carbon dioxide emissions might be regulated in the future. The company has been earning well below its allowed return in recent years. Without better returns, the company cannot attract the lower-cost financing needed to provide for the capital investment Utah customers need. Lower costs of financing in a vigorous construction phase mean lower prices for customers over the long term."

An exhaustive analysis and audit of Rocky Mountain Power’s financial results and forecasts will be completed before public hearings are held before the Utah Public Service Commission. The process may extend into August of 2008, with a final determination by the commission before new prices are implemented.

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About Rocky Mountain Power

Rocky Mountain Power serves some 758,000 customers in Utah. It is part of PacifiCorp, one of the lowest-cost electricity producers in the United States, providing approximately 1.7 million customers with reliable, efficient energy. The company works to meet growing energy demand while protecting and enhancing the environment. PacifiCorp has more than 9,000 megawatts of generation from coal, hydroelectric, natural gas and renewable wind and geothermal power. The company is a leader in the development of renewable energy sources and it renewable energy program, Blue Sky, won the environmental protection agency’s Green Program of The Year in 2007. PacifiCorp operates as Pacific Power in Oregon, Washington and California, and as Rocky Mountain Power in Utah, Wyoming and Idaho.

Media inquiries: 800-775-7950; newsdesk@pacificorp.com