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Natural Gas Companies Seek Big Hikes

August 8, 2008

By JUSTIN D. ANDERSON

After a winter where some West Virginians actually saw declines in their natural gas bills, the major natural gas providers to state consumers are asking for rate increases because of the escalating cost of the commodity.

Byron Harris, the state Consumer Advocate, said the seven largest natural gas companies doing business here could be charging customers up to 46 percent more this winter than last.

Harris said his office is asking the state Public Service Commission to phase in the increases over the next two years instead of dealing a blow all at once to West Virginians already strapped by rising food and gasoline costs.

That’s what the state did when hurricanes damaged natural gas production in 2005 and the companies raised rates, Harris said.

The average heating bill last winter actually declined modestly as compared to the year before.

Customers of the state’s largest gas company, Mountaineer Gas, paid an average monthly bill of $161.16 last winter. That was about a 3 percent decrease from the year before.

If Mountaineer’s most recent rate request were approved, customers would pay an average $229.19 a month, Harris said. That’s 42 percent more.

Equitable Gas is asking for an increase that would have its customers paying 46 percent more this winter.

If the PSC approves Equitable’s rate increase, its average monthly bill would be $236.97 after Nov. 1.

Customers of the other five companies could see the following percentage increases in their average heating bills:

* Bluefield Gas, 28 percent

* Hope Gas, 43 percent

* Union Oil and Gas, 20 percent

* Southern Public Service Co., 29 percent

* Consumers Energy, 42 percent

Only one company, Standard Gas, is asking for a decrease. Its request is to charge 32 cents less per million cubic feet.

Harris said the big increases are primarily due to the gas companies stockpiling natural gas from late spring through summer so they can provide reliable service to customers. Four of the seven largest gas companies in the state have the ability to stockpike, Harris said.

“The market price of gas has skyrocketed since the first of the year,” Harris said. “And a lot of that has been put into storage for use this winter. So, even though prices have come off here of late, we still have a lot of very expensive gas in storage.”

Natural gas was selling in July 2007 for $7.37 per million British thermal units. Last month, it was going for $13.54 per million Btu.

Harris said the increase could be blamed on many factors, including speculators and countries known for energy gluttony.

A surge of natural gas drilling in West Virginia won’t have much, if any, effect on what state consumers pay because it’s all put on the national market, Harris said.

Harris said the natural gas companies were willing to phase in the increases in 2005 so he hopes for the same cooperation this year.

In the meantime, Harris urged West Virginians to start preparing for the worst.

“We want to encourage people to take a very intensive look at how they use natural gas and how they consume it in their house,” he said.

A good start might be applying weather stripping or installing a programmable thermostat, Harris said. If you’re thinking of buying a new gas furnace, think energy efficient.

The state is having a tax holiday on appliances that have an Energy Star efficiency rating during the first week of September. Many gas furnaces meet the rating, but the tax holiday applies only to items that cost $2,500 or less.

Tips for making your home more energy efficient can be found at www.energystar.gov. A list of Energy Star-rated gas furnaces also can be found at that Web site.

Energy-saving tips The state Consumer Advocate is advising the public to get their homes energy efficient to help soften the blow of proposed natural gas rate increases. Here are some tips: i Change the air filter in your furnace regularly. i Get a tune up on your heating and cooling equipment. i Install a programmable thermostat. i Seal heating and cooling ducts. i Consider buying energy efficient heating and cooling equipment. i Install weather stripping in the house. Source: Energystar.gov

Originally published by DAILY MAIL CAPITOL REPORTER.

(c) 2008 Charleston Daily Mail. Provided by ProQuest Information and Learning. All rights Reserved.




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