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Xcel Energy Projects Winter-Month Bill for 2005-06 Heating Season; Announces October Monthly Natural Gas Prices

Posted on: Friday, 16 September 2005, 21:00 CDT

Xcel Energy released projections for a winter-month bill for the 2005-2006 heating season today. The company also filed its October 2005 monthly natural gas cost adjustment (MGCA) with the Colorado Public Utilities Commission (CPUC), to reflect changes in prices from September 2005.

December 2005 Estimated Bill

The company is projecting an increase in typical residential natural gas bills of 34 percent in December, when compared to December 2004 bills. Typical small-business customer bills would increase by 35 percent from last year.

Typical residential customers are expected to pay $170.52 in December, compared to $127.48 in December 2004. Typical small-business customers would pay $776.40 in December, compared to $573.19 in December 2004. Both bills reflect an anticipated increase in the market price of natural gas; these costs are passed through to customers on a dollar-for-dollar basis and do not result in any profit for Xcel Energy.

Actual natural gas prices to be charged by Xcel Energy in December remain subject to the MGCA, which will be filed in mid-November 2005, based on current market prices for natural gas that month.

October 2005 Monthly Gas Cost Adjustment

The natural gas commodity price proposed to the CPUC for residential and small-business customers would increase to $0.9066 per therm in October, up from $0.7744 per therm this month. This represents a 16-percent increase in price.

As a result of the price change from September to October, combined with a projected doubling of customer consumption, natural gas bills are expected to increase in October by 98 percent for typical residential customers and by 123 percent for typical small-business customers.

The largest component of the bill increase will be customer use. Typical residential customers are expected to increase consumption by 104 percent in October compared to September, so their overall bill would increase to $64.41, based on consumption of 52.3 therms. This compares to $32.52 this month on use of 25.6 therms.

Typical small-business customers are expected to use 108 percent more natural gas in October, compared to September. Typical bills would be $323.86, based on consumption of 290.5 therms, compared to bills this month of $145.50 on use of 139.9 therms.

In October 2004, typical residential bills were $43.25, or $21.16 lower than projected for October 2005, based on the same consumption of 52.3 therms. Typical small-business customer bills were $206.35 in October 2004, or $117.51 lower than projected for next month, also based on the same use of 290.5 therms.

Included in the October MGCA is an annual change in the interstate pipeline charge. The interstate pipeline charge will decrease by 2.5 percent in October and moving forward.

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-for-dollar basis.

The monthly and annual filing submitted today would take effect Oct. 1, 2005, if approved by the CPUC.

Natural Gas Market Conditions

Projected natural gas prices for October 2005 are higher due to a continued tight balance between natural gas supply and demand. Weather has provided upward pressure on prices. Summer temperatures have been higher than normal in 2005, which has increased gas demand for electric generation.

Hurricane Katrina is reported to have caused more damage to Gulf Coast natural gas production capability than last year's Hurricane Ivan. About 3.8 billion cubic feet per day of natural gas production remains shut-in due to the storm. Forecasters still are projecting very active tropical storm activity for the rest of the season.

Rocky Mountain natural gas prices, however, have not experienced the full impact of Hurricane Katrina. At the time of this filing, Colorado natural gas prices are more than $2 below the market prices for areas of the U.S. directly impacted by the hurricane, and this difference is reflected in the monthly prices Xcel Energy filed today.

National gas storage inventories also have fallen below last year's levels, although the quantity in storage is still above the five-year average levels. Crude oil prices remain at about $63 per barrel, which was the same price last month.

Energy Efficiency/Energy Assistance

Xcel Energy encourages customers to explore ways to conserve energy and lower their natural gas bills, by visiting Xcel Energy at www.xcelenergy.com or by calling 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 website.

Customers may also wish to seek low-income energy assistance and information on energy efficiency programs by contacting the federal Low-Income Energy Assistance program (LEAP), which starts Nov. 1, or Energy Outreach Colorado (EOC). Call 866-HEAT HELP (866-432-8435) for further information.

Source: Business Wire

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