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News Release
Higher Natural Gas Bills On the Horizon
 
September 23, 2003 (2003 - 026)(UG 154, UG 155, UG 156)
 
Contacts:  Lee Beyer, Chairman, 503 378-6611; Ray Baum, Commissioner, 503 378-6611; John Savage, Commissioner, 503 378-6611; Bob Valdez, Public Information Officer, 503 378-8962
 
Salem, OR – Customers of Oregon’s three natural gas companies will experience higher natural gas bills this winter due to more expensive wholesale natural gas prices.
 
Today the Oregon Public Utility Commission approved new rates for Northwest Natural, Avista Corporation, and Cascade Natural Gas companies to take into account wholesale price increases. The changes take effect October 1, 2003.
 
The Commission adjusts each company’s rates once a year to reflect changes in the wholesale price of natural gas. The Purchased Gas Adjustment (PGA) passes through to customers increases or decreases in the utility’s cost of buying gas for the upcoming year. It also addresses differences between the purchased cost of gas costs forecast in the previous year with actual costs. The companies make no additional profit from these rate adjustments.
 
"We know that any increase can be difficult for households and businesses to absorb. However, although wholesale prices are higher due to variety of market forces, fortunately they are not as high as we previously expected," Commission Chairman Lee Beyer said. "There are things customers can do to reduce the impact of these increases, especially during the upcoming winter months, when the effect on their bills will be more noticeable."
 
The monthly bill for a typical residential customer of Northwest Natural who uses 61.5 therms will increase by 4.5 percent. The typical customer’s bill will go from $60.04 to $62.71, an increase of $2.67. In January, a typical residential customer’s consumption of 131 therms would result in a billing increase from $121.11 to $126.80. Commercial and industrial customers will see an increase of between 4.9 to 5.6 percent. Northwest Natural customers received an overall 1.1 percent increase September 1, 2003 due to a general rate case. Northwest Natural serves about 501,224 customers.
 
Residential bills for Avista’s customers will increase by 12.25 percent. The bill for a typical residential customer using 55 therms per month will go from $43.09 to $48.37, an increase of $5.28. The January bill for a typical residential customer would increase $10.55 over last January’s bill. Rates for industrial and commercial customers will increase from 14.5 to 15.4 percent. Avista serves about 82,264 customers in LaGrande, Grants Pass, Medford, Klamath Falls and Roseburg.
 
The Commission will issue a decision soon on the company’s general rate case that also will take effect October 1, 2003. A general rate case includes expenses other than wholesale natural gas prices. This the first time Avista has had a general rate case increase in Oregon since acquiring the system in 1991.
 
"This is a difficult decision. However, it’s a fact wholesale natural gas prices are higher," Commissioner Ray Baum said. "That’s little consolation though for households on fixed incomes."
 
The monthly bill for a typical residential customer of Cascade who uses 63 therms will increase by 1.9 percent. The typical customer’s bill will go from $58.82 to $59.95, an increase of $1.13. In January, a typical residential customer’s use of 131 therms would result in a billing increase from $119.07 to $121.43. Commercial and industrial customers will see an increase of 2.0 to 2.6 percent. Cascade serves approximately 46,910 customers in Central and Northeastern Oregon.
 
Wholesale prices per million British thermal units are 35 percent higher than a year ago. A million BTU’s was going $5.043 as of yesterday compared with $4.27 a year ago and $2.84 in 2001.
 
With rates on the rise, there are a number of things consumers should consider doing to reduce their energy costs, including:
  • Contacting your gas company to set up an equal payment plan to spread high winter bills over a 12-month period.
  • Turning the thermostat down can save up to 3% for each degree of reduction. A programmable thermostat that automatically reduces heat at night or while the house is unoccupied can lower heating bills by 5 to 10%.
  • Asking for an energy audit by the utility that provides the customer's heating. Utilities are required to provide free energy audits. They also provide incentives such as rebates or loans for recommended measures.
  • Sealing cracks, gaps and other places where air leaks can generally result in a 10% heating and cooling savings.
  • Fully insulating a residence generally results in up to 30% savings on a heating bill.
  • Applying to the Oregon Office of Energy for state tax credits of up to $250 if they have an office-certified contractor seal furnace ducts. As much as 25% of the heat in a forced-air heating system may be lost through ductwork leaks.
  • Updating low-efficiency furnaces with higher-efficiency models. All three natural gas companies offer a rebate for doing so. Customers of Northwest Natural must contact the Oregon Energy Trust at 1-866-entrust.
  • Making sure the existing furnace operates efficiently.
  • Change or clean the furnace filter once a month during the heating season if needed. A tax credit is available for testing and servicing gas furnaces if done by contractors certified by the Oregon Office of Energy.
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