AARP Wyoming Petition Opposes RMP Rate Case

Rocky Mountain Power (RMP), an electric utility serving around 150,000 customers in Wyoming, is requesting a rate increase of 14.7% from Wyoming’s Public Service Commission (PSC). The request would raise $123.5 million for the utility. RMP says the typical customer in its footprint would see a rate increase of $17.17 per month and high power users could see their bill jump by closer to $31 per month. RMP provides electricity in Wyoming in the city of Laramie, between Douglas and Casper, in the Big Horn Basin, and almost all of Southwest Wyoming.

AARP Wyoming has produced an online petition which it will deliver to the PSC during a hearing later this year. To sign our online petition against the rate increase, go to aarp.org/wy and search Rocky Mountain Power. The petition was released in mid-October and led to better than 400 petition sign-ups in the first week.

The rate case itself will extend into 2025 before the PSC decides the allowed rate increase. The Wyoming Office of the Consumer Advocate (OCA) and the state’s Industrial Energy Customers have formally intervened in the case which will require RMP to open its books to regulators at the PSC and explain why the rate increase is necessary. AARP Wyoming will be sure to let members know when and how to offer its members public comment.

RMP tells AARP Wyoming the rate increase is needed to continue to build out transmission and generation infrastructure, as well as to pay for insurance, claiming excess liability insurance costs went up 270% this year and have increased 1,888% over the last five years.

For its part, AARP Wyoming State Director Sam Shumway points out that many of AARP Wyoming’s members are on fixed incomes and some struggle to make ends meet. He says the RMP request requires significant review and scrutiny by the Public Service Commission to ensure these proposed increases are based on just and reasonable costs which accrue benefits to customers.

AARP Wyoming has three specific concerns with the rate increase:

• The RMP proposed increase in residential fixed charges from $20-23 per month is around a 15% increase and bears discussion. When you remove the increase to the residential fixed monthly cost, the retail proposed increase is closer to 17%. AARP Wyoming wants to see evidence to make sure this is necessary.
• AARP Wyoming would like to see a review and determination as to whether significant transmission projects are prudent. The transmission projects, including some that take electricity out of Wyoming to serve other markets, make up a significant portion of the rate increase.
• RMP would like to implement a new cost adjustment mechanism that AARP Wyoming feels might shift additional risk to RMP customers. The change would also allow for customer rates to be changed without going before the Public Service Commission.

Anthony Ornelas is the Director of the OCA, which is also looking through the case to determine if the rate increase is warranted. He says there are a number of drivers for this rate increase, specifically, the need for more funding for energy transmission projects, changes in the cost of fuel for power generation and the issue of utilities being charged for insurance costs.

RMP’s large-scale Gateway South energy transmission project (which takes power from the Shirley Basin to Southern Utah) and Gateway West (which takes power from Glenrock through Medicine Bow, and then to Downey Idaho) were mentioned in last year’s RMP rate case. While Wyomingites did pay for a portion of those capital improvements a year ago, another round of investment in the project is coming due.

Ornelas added that just as Wyomingites are seeing their homeowners and auto insurance premiums increase, so is Rocky Mountain Power. The utility carries insurance in case to protect itself from damage that is found to be caused by the actions of the utility itself and that insurance has risen dramatically of late. Ornelas says a policy that cost Rocky Mountain $3-5 million just a few years ago, might be costing closer to $165 million today due the severity of wildfires throughout the West. Now, that increase will be shared by the rate payers of Rocky Mountain Power.

“A few years ago the cost of the insurance was so small it was decimals upon decimals on people’s bills,” Ornelas said. “Now, we are seeing two, three, or sometimes a four-fold increase on this insurance. In some cases this insurance isn’t available at all. Excess liability insurance costs are available, the cost of this insurance is 80-90% on the dollar due to the severity of wildfire risks. Customers are absolutely feeling the impact of this.”

As for net power costs, Ornelas says contract prices for fuel for power generation such as natural gas have been escalating in recent years and suppliers tend not be willing to enter into significant long term contracts that lock in a price for the utility. That leads to more volatile costs for the utility and its customers.

“Net power costs are the fuel for the car,” he said. “We have to pay for every ton of coal we (the utility) uses to generate power on its customers behalf or MBTU of natural gas or wholesale purchases we make to service Wyoming as well. Those have been increasing in recent years. That was a primary driver last year and it is certainly an important and hefty issue in this case.”

The bad news is Ornelas doesn’t believe we have seen the end of rate increase cases. He feels this is the first time in the last 10-15 years that the nation as a whole is seeing expanded demand for more power, driven by the computing needs of crypto mining, data centers, and AI. Those all take massive amounts of electricity. He says a push to give up gas-powered cars and move to electric vehicles is also having an effect on power generation as well as the transmission the nation uses to move electricity from where it is generated to where it is consumed. However, Ornelas points out Wyoming’s PSC and OCA have worked together to develop a unique tariff for data centers which he believes will insulate standard retail customers from feeling the sting of increased power rates due to more power being needed on the grid.

The bigger issue appears to be demand from the public for renewable energy as well as federal policy which he feels is aimed at decarbonizing the way power is generated. Ornelas says a new soda ash mining company outside of Green River recently announced it will run entirely on renewable energy.

To Sign on to this petition, go to AARP.org/wyoming