Climate Commitment Act rate adjustments for Washington Avista natural gas customers
BY LYNN
This is the result of SB 5126, 2021-22 session otherwise known as the Washington Cap and Trade Bill.
The Climate Commitment Act (CCA), passed by the Washington state legislature in 2021 and implemented by the Washington Department of Ecology, aims to reduce carbon emissions and achieve greenhouse gas limits set in the state law. It requires all businesses, like Avista, with emissions exceeding a certain level, to reduce those emissions to net zero by 2050 and to meet emissions targets along the way.
The CCA is designed as a cap-and-invest program. It sets an emissions limit, or cap, and then lowers it over time. Natural gas utilities, like Avista, must purchase allowances equal to their emissions, sold in an auction format or purchased on a secondary market. As stated by the Washington Department of Ecology, funds raised from the allowance auctions will support new investments made by the state climate-resiliency programs, clean transportation, and addressing health disparities across the state.
Impact to Washington Avista Natural Gas Customers
In March, the Washington Utilities and Transportation Commission approved Avista’s natural gas rate adjustment for the CCA, which took effect in April. This rate adjustment has two components that follow the State’s rules. One is the CCA charge — Avista’s costs to comply with the cap and invest program — and the other is a CCA credit, which is derived from revenues Avista received from allowances that it was required to sell at auction. This credit is reserved for customers connected to Avista’s system prior to July 26, 2021, and all identified low-income customers. Based on a CCA charge per therm of $0.22518, the amount each customer will pay towards the CCA will depend on their actual usage, which changes month to month. For identified low-income customers, the CCA credit will fully offset the CCA charge. For all other customers, that receive the CCA credit, it will be a flat credit that helps to offset the CCA charge each month.
Many Avista customers will notice an overall, year-over-year increase in their bill due to the CCA, though the total cost impact will vary by customer. Most Avista natural gas customers will see an increase of $1.35-$5.45/mo due to the Washington CCA charge. Please see the chart below for details.
| Washington Natural Gas Customers | Connected to Avista system on or before Jul 25, 2021 | Connected to Avista system after Jul 25, 2021 | |||
| Type of Service | Average Monthly Use | Bill Increase Amount | % Change | Bill Increase Amount | % Change |
| Residential & Small Commercial Apr-Oct | 64 therms | $1.33 | 3.26% | $14.96 | 16.05% |
| Residential & Small Commercial Nov-Mar | $5.45 | 0% | $0.00 | 0% | |
| Residential (Low Income Identified) Jan-Dec | 64 therms | $0.00 | 0% | $0.00 | 0% |
| Large Commercial Apr-Oct | 1460 therms | $38.91 | 3.83% | $328.87 | 18.13% |
| Large Commercial Nov-Mar | |||||
| Large Commercial/Industrial (Former Transport) Jan-Dec | 11,499 therms | * | * | $2,589.28 | 22.85% |
| Large Commercial/Industrial Interruptible Jan-Dec | 54,770 therms | $2,473.42 | 6.96% | * | * |
| Large Commercial/Industrial Interruptible Transport Jan-Dec | 54,879 | $2,906.40 | 33.49% | $7,369.95 | 99.57% |
*Avista does not serve any customers in this category as of 03-07-2024
For more information about Avista’s Rates and Regulations, visit myavista.com/rates.