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News Release
Commission Expects Higher Natural Gas Prices This Winter
July 16, 2003 (2003 - 019)
Contacts:  Roy Hemmingway, Chairman, 503 378-6611; Lee Beyer, Commissioner, 503 378-6611; Bob Valdez, Public Information Officer, 503 378-8962
Salem, OR – The Oregon Public Utility Commission is warning that consumers will likely see higher gas bills this coming winter. The warning comes after a briefing to the Commission today by a number of natural gas industry officials who predicted that higher prices this summer mean consumers will likely pay more for natural gas this winter.
"Normally, wholesale prices come down in the summer, and gas retailers take advantage of these lower prices to store gas for the winter," Commission Chairman Roy Hemmingway said. "However, we haven’t seen prices come down much this summer. Unfortunately, I fear consumers should brace themselves for the prospect of paying more this winter."
"If there is a silver lining in this dark cloud, it’s that our price increases should not be as large as other parts of the country might see," added Commissioner Lee Beyer. "We are fortunate to have easy access to adequate supplies of natural gas from Canada. However, I am concerned about the potential impact of higher prices on residential, commercial and industrial customers."
Higher natural gas prices also put pressure on electric companies to raise their rates, because companies use natural gas to generate energy.
In order to minimize the impact of higher gas prices, consumers are encouraged to take preventive measures. The Commission suggests consumers insulate their home, lower the thermostat, tune up their heating system, wrap their hot water heater, insulate pipes and check with their utility to find out if budget billing is available.
Oregon’s three natural gas distribution companies will file purchased gas adjustment proposals with the Commission in mid August to reflect the price of gas in the market. The Commission will review the filings and make a decision. The new rates would take effect October 1, 2003. The Commission resets rates based on the price of natural gas once a year. The adjustment is revenue neutral for the companies. That means the companies neither make nor lose money from the adjustments. The companies pass on the increased or decreased gas costs directly to consumers.
The three natural-gas companies in Oregon, which serve over 627,000 customers, are: Northwest Natural serving approximately over 500,000 customers, Avista about 82,000 and Cascade more than 45,000.