State regulators order Puget Sound Energy to refund over-collected rates

Media contact: [email protected] or 360-664-1116
Docket number: UG-240729

LACEY, Wash. - On Dec. 19, 2025, the Washington Utilities and Transportation Commission rejected, in part, Puget Sound Energy's (PSE) proposed rate request to recover costs related to the Colstrip coal-fired power plant, filed in September 2024. The commission previously allowed PSE's request to recover costs, subject to refund. After considering the full record, the commission ordered PSE to file new tariff sheets that will result in a decrease in revenue of $6.84 million. The decrease will be refunded to customers starting in January 2026 for the rates PSE overcharged related to Colstrip.

The commission disallowed five of PSE's Colstrip investments as imprudent and allowed full recovery for six investments to support health and safety at the plant. The commission prorated the remaining investments, determining that PSE may not charge customers for any investments with an in-service date or continuing costs after Jan. 1, 2026, as the investments will no longer be necessary or useful to Washington customers.

Washington's Clean Energy Transformation Act (CETA) requires all electric utilities serving Washington to remove coal-fired electricity from rates by Dec. 31, 2025. To comply with CETA, PSE is transferring its 25% ownership share of Colstrip Units 3 and 4 to NorthWestern Energy Corporation on Jan.1, 2026.

Because the statute requires coal-fired electricity to be removed from rates by Dec. 31, 2025, and because the transfer occurs after the deadline to remove coal-fired electricity from rates, the commission determined the agency was not required to review the agreement. As part of the order, the commission required PSE to submit any future property transfers made to comply with CETA to the commission for review.

In August 2025, the commission held a public comment hearing where customers shared concerns over additional rate increases, subsidizing coal electricity for use by other states, and CETA compliance. The commission made its decision with these comments in mind. The order addresses the requirements of CETA and the public interest by supporting the transition to a clean energy economy, reducing burdens to vulnerable populations and highly impacted communities, and ensuring fairness for customers. 

About the UTC

The UTC regulates the rates and services of investor-owned electric utilities, telecommunications companies, natural gas and water companies, solid waste collection companies, household-goods movers and passenger transportation companies, commercial ferries, pipeline companies, marine pilotage, and a low-level radioactive waste repository. The commission does not regulate the rates of broadband services, cellular, cable, or Internet service. 

About PSE

Bellevue-based Puget Sound Energy is a subsidiary of Puget Energy. PSE provides service to around 1.24 million electric customers and nearly 900,000 natural gas customers in 10 Central and Western Washington counties.

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