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Area Cities to Challenge Natural Gas Surcharge

Posted on: Monday, 7 November 2005, 12:01 CST

By Jessica DeLeon, Fort Worth Star-Telegram, Texas

Nov. 5--Several cities in Northeast Tarrant County are fighting a proposed surcharge by Atmos Energy that could increase residents' utility bills by about $7 a year.

Businesses would pay an additional $23 a year and industrial businesses an extra $704 a year, said Mirenda McQuagge-Walden, Bedford's special projects manager and communications director.

The surcharges would be in addition to the higher costs that consumers are expected to pay because of rising natural-gas prices.

But city councils in Bedford, Haltom City, Hurst, North Richland Hills and Richland Hills passed resolutions against the gas company's request for the surcharge, known as a Gas Reliability Infrastructure Program increase. The Flower Mound Town Council will consider the issue Monday.

"The onus is on cities to hold the company's feet to the fire," Hurst Assistant City Manager Jeff Jones said.

The program allows gas companies to be reimbursed for their expenses without going through the regular rate case filing with the Texas Railroad Commission.

The increase would pay for equipment, such as gas meters and new pipelines, in Texas. Atmos spokesman Rand LaVonn said the company believes that the surcharge is a fair amount to recover what Atmos spent to expand its natural gas pipeline system. He added that the system will provide more gas to growing areas and allow new companies to come in and provide new jobs.

But city officials say that Atmos' definition of equipment includes items such as desks and computers that should not be covered by the proposed surcharge. They also point out that the request does not account for an increase in Atmos customers, and they believe that the company has underestimated its revenues.

Jones said the cities have not reviewed Atmos' financial structure since it bought TXU's gas distribution system last year. Atmos is basically charging for the expenses that were approved for TXU, which had different debt and expenses, Jones said.

The Texas Railroad Commission will likely decide the case for the surcharge in the first part of next year. Last year, the commission ruled in favor of Atmos for a similar request.

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Copyright (c) 2005, Fort Worth Star-Telegram, Texas

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ATO, TXU,

Source: Fort Worth Star-Telegram (Fort Worth, Texas)

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