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Rocky Mountain Power’s costs for fuel and purchased power increased in 2023, because of higher wholesale market prices and coal supply disruptions, which made purchasing power to serve its customers more expensive. As part of an annual review of these costs, the company requested an average 12.3% price increase for Wyoming customers. A typical residential customer using 700 kilowatt-hours per month would see a 9.3% increase, or $12 per month on their electricity bill. The increase will take effect July 1, 2024, subject to review and approval by the Wyoming Public Service Commission.

"We recognize that in difficult economic conditions, a price increase is not good news," said Joelle Steward, Rocky Mountain Power senior vice president for regulation and customer and community solutions. "Despite these difficulties, we remain committed to bringing the best value to our customers for their hard-earned dollars. We’ve worked diligently to control the costs we can control. We are strict with our budgets and continue our work to steadily improve our system to enhance reliability for our 144,511 customers in Wyoming."

"The company is working hard to maintain our position as a low-cost energy provider," Steward added. "The annual adjustment process makes sure Rocky Mountain Power customers always pay a fair price for the energy they need."

The most significant driver in this year’s energy cost adjustment involves coal supply and inventory restrictions that began in late 2022 and continued into 2023. Historically low coal inventories, prompted many utilities, including Rocky Mountain Power, to increase natural gas generation and purchase more wholesale electricity while restocking depleted coal inventories. In many coal basins nationally, coal pricing more than doubled in 2022 and remained high into 2023. This effect on coal pricing was made worse by the war in Ukraine, when many U.S. mines, including mines in Utah and Colorado, rushed to take advantage of high coal prices by exporting coal to Europe.

"Due to overall lower coal resource output, the company had to adjust its overall system operations through increased natural gas power plant output, reduced market sales and increased market purchases," said Jack Painter, net power cost specialist for the utility. "In 2023, all of PacifiCorp’s Utah coal suppliers and one major Wyoming coal supplier made emergency contract declarations that resulted in significant delivery shortfalls of PacifiCorp’s contracted coal supply. Consequently, the Utah coal mines experienced a 35% decrease in coal production."

These challenges included a coal mine fire that occurred at American Consolidated Natural Resources’ Lila Canyon mine in central Utah. The mine had produced more than 25% of Utah’s coal production in recent years. The mine first stopped production in September 2022 and the owners announced the permanent closure of the Lila Canyon mine in November 2023 after determining that it was not possible to safely remediate and operate the mine. In response, the company explored the purchase of reasonably priced coal from a variety of other sources, as well as using surplus coal reserves held by the company.

The annual energy cost adjustment mechanism is designed to track the difference between the company’s actual expenses for fuel and electricity purchased from the wholesale market, against the amount being collected from customers through current rates. Pending commission approval, the changes would take effect July 1, 2024.