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Utility could face legal battle over rate hike
This is an archived article that was published on sltrib.com in 2008, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Posted: 10:31 AM- A spokeswoman for the Utah Public Service Commission says Rocky Mountain Power could face a legal battle with the state if the utility curtails electric service to its Utah customers because of the state's denial of the full amount of the company's rate-increase request.

Commission spokeswoman Julie Orchard says that state law requires the utility to provide adequate electric service to Utah customers.

Rocky Mountain Power says that on Sept. 15 it will implement sweeping changes that include reducing customer service and eliminating discretionary maintenance. The utility also says it will eventually consider cutting service if it becomes too expensive.

"The cost of providing for increased electric consumption by existing customers and the cost of providing service to new customers has exceeded the revenue the company receives from these customers," company president Richard Walje said.

The utility had sought a $74 million rate increase, but was awarded an increase of just $33.4 million by the PSC, an amount company officials said wasn't enough to meet the needs of a growing customer base.

On Tuesday Rocky Mountain Power filed a legal appeal of the commission's decision. The utility also has a second rate increase request - for $85.2 million - pending.

Michelle Beck, director of the Committee of Consumer Services, criticized the Rocky Mountain Power for threatening to cut service and said the PSC gave careful consideration to each line item in the utility's request.

"If the utility doesn't have enough to run its business, then it's its own fault," she said.

Consumers said the company, which has a monopoly in the marketplace, shouldn't complain about the amount of its rate increase,

"In this economy and in this market, I would think that they would step up and would accept a lower margin for their service, with the understanding that everyone else is suffering with lower margins, as well as increased costs," Salt Lake City resident Shane Hanna said.

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