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Xcel Energy Proposes September Natural Gas Prices

Posted on: Thursday, 18 August 2005, 18:00 CDT

Xcel Energy today proposed a moderate increase in September 2005 natural gas commodity prices. Coupled with a large percentage increase in use, projected bills would increase next month by 37 percent for typical residential customers and by 30 percent for typical small-business customers.

The natural gas commodity price proposed to the Colorado Public Utilities Commission for residential and small-business customers would increase by 7 percent in September to $0.7744 per therm, from $0.7266 per therm in August.

The largest component of the bill increase is customer use. Typical residential customers are expected to increase consumption by 50 percent in September compared to August, so their overall bill would increase to $32.52, based on consumption of 25.6 therms. This compares to $23.74 this month on use of 17.1 therms.

Typical small-business customers are expected to use 28 percent more natural gas in September, compared to August. Typical bills would be $145.50, based on consumption of 139.9 therms, compared to bills this month of $111.81 on use of 109.3 therms.

Xcel Energy does not profit from the sale of the natural gas commodity. All costs associated with increases or decreases in the commodity price of natural gas are passed along to customers on a dollar-per-dollar basis. If approved, the new prices would take effect Sept. 1.

In September 2004, typical residential bills were $25.53, or $6.99 lower than projected for next month, based on the same consumption of 25.6 therms. Typical small-business customer bills were $107.37 in September 2004, or $38.13 lower than projected for next month, also based on the same use of 139.9 therms.

Gas prices remain high due to a continued tight balance between natural gas supply and demand. Weather has provided upward pressure on prices. July and early August temperatures have set or been near record highs, which has increased natural gas demand for electric generation. Forecasters are still projecting very active tropical storm activity for the rest of the season.

Crude oil prices, at about $63 per barrel compared to $60 per barrel a month ago, have also put upward pressure on natural gas prices. National natural gas storage statistics continue to reflect a surplus in inventory compared to last year, although injection volumes are at a reduced rate compared to last year.

Xcel Energy encourages customers to explore ways to conserve energy and lower their natural gas bills by accessing related information on the Web at xcelenergy.com or by calling 1-800-895-4999 for a free copy of "60 Simple Ways to Save Money on Your Energy Bill." Customers also are encouraged to contact the company for information on Averaged Monthly Payment. Business customers may order a free copy of the "Small Business Guide to Energy Savings" on the company's Web site. Customers may also wish to seek low-income energy assistance by contacting 1-866-HEAT HELP (1-866-432-8435).

Source: Business Wire

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