SW Gas rate hike draws little comment

Kevin Rademacher

Thursday, March 4, 2004 | 11:17 a.m.

Just two consumers spoke out Wednesday at a consumer session on a proposed $45.6 million Southwest Gas Corp. rate increase.

The Las Vegas-based natural gas company asked regulators for the so-called purchased gas adjustment to compensate for higher prices the utility is paying for the gas it distributes to its customers.

If approved, the average residential customer's winter bill would jump from $49.34 to $58.22. Customer bills went up to their current level from $46.58 on Feb. 1 when the company received regulatory approval to end a consumer credit for a past rate reduction.

One customer who spoke out at the session complained about the surprise February increase.

"There was nothing in my bill explaining why there was a change," said Bernice Hilton.

Bridget Branigan, senior attorney for Southwest Gas, said customers were notified with a bill insert. She also said that the $14.2 million the company saved by ending the credit early was deducted from the original rate increase proposal of $59.8 million.

If approved by the state Public Utilities Commission the increase could go into effect June 1. Southwest Gas made the request in December in an "out-of-cycle" rate filing. At that time the company said it needed to respond early to higher costs created by a volatile market. Had the company waited until June when filings are typically made, interest charges would have been incurred on the unrecovered balance, company executives said.

Company executives said Wednesday they could file another request in June if prices continue to climb. They also said a rate reduction could be requested at that time if prices ease.

"It would depend on market conditions," Branigan said, adding that a possible June increase request would be mitigated by any relief the company gets in the current proposal.

After the consumer session, Southwest Gas spokesman Roger Buehrer said the volatility in the market has eased.

"In recent months gas costs have leveled off a bit but they are significantly higher than they were a year ago," he said. "How that transcends into the future, we are watching that all the time."