California rate cut approved

Tuesday, Feb. 19, 2002 | 9:46 a.m.

The California Public Utilities Commission last week gave the okay for Southwest Gas Corp. of Las Vegas to lower the cost of natural gas from 66.7 cents per therm to 37.5 cents per therm for its 104,000 Southern California customers from Jan. 16 through March 31, a 25-percent rate decrease.

A therm is 100 cubic feet of natural gas. The move comes amid an investigation started in June 2001 by California regulators into the company's gas buying practices at the California border during the energy crisis last year after thousands of customers complained of skyrocketing natural gas bills.

The commission said since the new rate would not be enough for Southwest to recover its actual cost of gas during the period outlined, it would be allowed to amortize the remainder over a two-year period. The CPUC said the decrease and a two-year surcharge were proposed so that customers could get rate relief during the winter after many customers said they are facing "extremely serious problems" paying their bills during the winter.

Due to lower wholesale prices for natural gas, Nevada regulators have approved three rate decreases totaling $91.7 million in the last two months for Nevada customers.