Southwest Gas plan calls for stopping credit refunds

Kevin Rademacher

Monday, Dec. 22, 2003 | 11:05 a.m.

A proposal by Southwest Gas Corp. of Las Vegas to end credit payments to customers is drawing mixed reactions from industry analysts.

Public Utilities Commission staff late Friday filed a motion recommending that commissioners examine the gas company's request to end refund payments. Those payments -- a small part of the existing rate structure -- are designed to reimburse customers for an over-collected balance based on past costs for natural gas.

The utility earlier this month asked to stop the refunds -- which will amount to about $14.2 million -- because higher current gas costs will have eaten up any credit balance by Jan. 1.

"To prevent ratepayers from being credited with monies that may need to be repaid, with interest, staff requests that the commission promptly ... schedule a proceeding as soon as possible to determine whether refunds should cease," Louise Uttinger, PUC assistant staff counsel, said in the filing.

Nevada Consumer Advocate Tim Hay said the request to end the credit is an attempt to raise rates outside of the existing regulatory framework.

"Southwest's motion is legally flawed and should be denied," Hay said in the filing.

The move to end the credit came a week after Southwest Gas filed a rate increase request seeking to raise rates more than 25 percent to cover higher gas costs.

The rate increase request -- which would amount to more than $59 million a year -- came just days after an 11 percent rate increase request that was approved by the PUC in November went into effect.

Southwest had asked for the new rate increase request to be expedited, allowing the first phase to go into effect March 1. PUC staff and Hay both argued against that schedule.

The utility proposed ending the credits as an alternative to that fast-track schedule.

In other utility news, Nevada Power Co. on Friday amended it's request to raise general rates by $142 million a year. Revised calculations now indicate that the utility will seek a $133.5 million annual increase.