PSC Judge Recommends Hefty Hikes for Natural Gas
By JASON PYLES and CASEY JUNKINS POSTED: October 15, 2008
WHEELING - Mountain State residents, take note: If you heat your home with natural gas, be prepared for a sizeable increase in your bill come Nov. 1.
The West Virginia Public Service Commission's chief administrative law judge, Melissa Marland, is recommending interim rate increases for most of the state's natural gas companies. For West Virginia customers who have service through Mountaineer Gas Co., which covers most of the Northern Panhandle, that increase could be 33 percent, or an average of $53 per month.
Unless the full commission overturns Marland's recommendations, the interim rates would go into effect Nov. 1.
Final rates must be approved in March, but PSC spokeswoman Sarah Robertson says that if the market stabilizes later and natural gas costs are very different, the rates can be readjusted.
The anticipated $600 per year in additional natural gas costs didn't sit well with local residents.
"That is ludicrous," said Wheeling resident Janice Raheem. "The consumer should not be responsible for this kind of stuff. There are people who cannot pay their bills now. The company needs to readjust this stuff on the customers' ability to pay."
Toni Chapman, also a Wheeling resident, understands that inflation is affecting prices for nearly everything but still worries about whether she and her neighbors will be able to afford to heat their homes.
"I can see why they are doing it, because the cost of everything else is going up," Chapman said. "But as a resident, I am very concerned about the gas company raising bills this much."
And other residents shared those concerns.
"That's going to make my rent go up a lot," said Wheeling resident Scott Woodstuff. "Coming in on the end of the current market crisis, I can see this rate increase pushing people right over the edge."
Elm Grove resident Janet Jaquay said, "Where do they think we're going to get the money to pay for that? ... People may still be able to heat their homes, but they're not going to be able to eat."
Marland also recommended that the commission approve interim hikes of up to 38 percent for a dozen other natural gas companies that do business in the state. Decreases were recommended for another three companies.
Marland's recommendations are lower than the increases sought by most of the companies, which were up to 46 percent.
The state's natural gas companies requested the rate adjustments to recoup money they paid for natural gas before prices started dropping.
While most of Marland's recommendations are lower than the increases sought by many of the companies, which were up to 46 percent, PSC Consumer Advocate Byron Harris plans to present a proposal to the commission by the end of the week for even lower hikes.
"It doesn't make any sense to hammer customers with these higher rates if it's not necessary," Harris said, adding that natural gas rates are falling.
PSC spokeswoman Sarah Robertson points out, however, that even though natural gas prices are on the decline now, most companies purchased their gas last winter and over the summer when prices were high.
"Last winter the market was so volatile, companies didn't know where the prices would go ... In their best, prudent purchasing decision, they went ahead and purchased then at a higher price."
The proposed rate increases are only for the costs incurred by the companies in purchasing their gas from suppliers, costs those companies are obligated to recoup, Robertson said. The rate increases will not be used for operational and maintenance costs, she said.
By JASON PYLES and CASEY JUNKINS POSTED: October 15, 2008
WHEELING - Mountain State residents, take note: If you heat your home with natural gas, be prepared for a sizeable increase in your bill come Nov. 1.
The West Virginia Public Service Commission's chief administrative law judge, Melissa Marland, is recommending interim rate increases for most of the state's natural gas companies. For West Virginia customers who have service through Mountaineer Gas Co., which covers most of the Northern Panhandle, that increase could be 33 percent, or an average of $53 per month.
Unless the full commission overturns Marland's recommendations, the interim rates would go into effect Nov. 1.
Final rates must be approved in March, but PSC spokeswoman Sarah Robertson says that if the market stabilizes later and natural gas costs are very different, the rates can be readjusted.
The anticipated $600 per year in additional natural gas costs didn't sit well with local residents.
"That is ludicrous," said Wheeling resident Janice Raheem. "The consumer should not be responsible for this kind of stuff. There are people who cannot pay their bills now. The company needs to readjust this stuff on the customers' ability to pay."
Toni Chapman, also a Wheeling resident, understands that inflation is affecting prices for nearly everything but still worries about whether she and her neighbors will be able to afford to heat their homes.
"I can see why they are doing it, because the cost of everything else is going up," Chapman said. "But as a resident, I am very concerned about the gas company raising bills this much."
And other residents shared those concerns.
"That's going to make my rent go up a lot," said Wheeling resident Scott Woodstuff. "Coming in on the end of the current market crisis, I can see this rate increase pushing people right over the edge."
Elm Grove resident Janet Jaquay said, "Where do they think we're going to get the money to pay for that? ... People may still be able to heat their homes, but they're not going to be able to eat."
Marland also recommended that the commission approve interim hikes of up to 38 percent for a dozen other natural gas companies that do business in the state. Decreases were recommended for another three companies.
Marland's recommendations are lower than the increases sought by most of the companies, which were up to 46 percent.
The state's natural gas companies requested the rate adjustments to recoup money they paid for natural gas before prices started dropping.
While most of Marland's recommendations are lower than the increases sought by many of the companies, which were up to 46 percent, PSC Consumer Advocate Byron Harris plans to present a proposal to the commission by the end of the week for even lower hikes.
"It doesn't make any sense to hammer customers with these higher rates if it's not necessary," Harris said, adding that natural gas rates are falling.
PSC spokeswoman Sarah Robertson points out, however, that even though natural gas prices are on the decline now, most companies purchased their gas last winter and over the summer when prices were high.
"Last winter the market was so volatile, companies didn't know where the prices would go ... In their best, prudent purchasing decision, they went ahead and purchased then at a higher price."
The proposed rate increases are only for the costs incurred by the companies in purchasing their gas from suppliers, costs those companies are obligated to recoup, Robertson said. The rate increases will not be used for operational and maintenance costs, she said.
