Heating bills
rise in time for fall
Sep 9, 2005 - The Salt Lake Tribune
Author(s): Steven Oberbeck
Sep. 9--Questar Gas customers will pay a lot more to heat their homes
this coming winter -- about 28 percent more than last year.
The company, though, isn't to blame. Higher natural gas prices beyond
Questar's control are causing the increase.
Questar Gas asked the Utah Public Service Commission (PSC) on
Thursday for permission to raise the cost of the natural gas it provides
to customers by 13.3 percent. On top of a 14.4 percent increase approved
by the PSC in June, that means Utahns this winter will pay about 28
percent more per month than last year.
"There is a silver lining," Questar spokesman Chad Jones said. "The
cost of the natural gas our customers use is a lot less than almost
everywhere else."
Natural gas users in Lincoln, Neb., for example, pay 17 percent more
than Utahns for their natural gas service. Consumers in Green Bay, Wis.,
pay 42 percent more, while those in Boston must pony up 80 percent more
to heat their homes, according to the American Gas Association.
This disparity is the result of Questar Gas only buying about half of
its gas supplies on the open market, where prices can fluctuate wildly.
The rest of Questar's gas comes from company- owned wells. That gas is
provided to customers at the cost of production. And it is that
low-price gas that helps keep costs lower in Utah than everywhere.
Questar supplies natural gas to customers at cost. But that means
when prices go up, the company must seek permission to increase what it
charges. When it goes down, the company will request a decrease. The
company typically asks to adjust the cost of the natural gas piped to
its customers twice a year -- in May and September.
So far, this year is no exception. However, recent rapid market price
increases due to the destruction caused by Hurricane Katrina - - costs
that are not expected to show up on Utahns' bills until next spring --
will force the company to keep a close eye on changing market conditions
in coming months, Jones said.
The price Utahns pay for their natural gas may be lower than
elsewhere, but the overall 28 percent increase from last year is still
hefty and more than most consumers in the state are used to, said Leslie
Reberg, director of the Committee of Consumer Services.
In June, after the PSC gave Questar permission for the first price
increase, the consumer committee launched an investigation to make sure
it was justified by market conditions. That probe is continuing, Reberg
said.
"We've brought in a consultant and our contract with him is open
ended, so he'll be able to include this latest rate hike in our
investigation as well," Reberg said.
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