Natural gas rates up in Nevada

BRENDAN RILEY

Friday, Oct. 28, 2005 | 6:55 a.m.

CARSON CITY, Nev. - Nevadans will pay anywhere from about 13 percent to nearly 25 percent more for natural gas, under terms of orders approved Thursday by the state Public Utilities Commission.

The biggest increase, 24.5 percent for typical gas customers in the Reno-Sparks area, was granted to Sierra Pacific Power Co. Such customers will see their monthly bills climb from just under $64 to just over $79 for 59 therms of natural gas.

The increase will provide Sierra Pacific with another $34 million in annual revenues. That's in addition to $64 million authoritized by the PUC in new annual revenues for electricity provided by the utility.

Typical residential customers using 715 kilowatt hours of electricity every month will see a 6.5 percent increase in their Sierra Pacific electric bills, from just over $86 to about $92.

Sierra Pacific said the rate changes were needed because of unprecedented high prices for natural gas being experienced across the nation. Utility executive Mary Simmons said it could have been worse, but Sierra contracted for winter gas supplies before a recent run-up in prices from its suppliers.

The federal government has predicted that regional prices for natural gas this winter will be anywhere from 30 percent to 60 percent higher than last year.

Besides the Sierra Pacific rate increase, the PUC authorized increases for Southwest Gas Corp. that will result in southern Nevadans seeing a nearly 16 percent increase in natural gas bills. The utility's northern Nevada customers will get an increase of nearly 13 percent.

The PUC's orders for the two utilities were among seven issued Friday in response to an upward spiral in wholesale costs of natural gas. Over the last year, natural gas prices have gone up 130 percent. The agency said recent hurricanes, reduced supplies and higher-priced gas futures contracts all figured in the higher prices.

Commissioner Jo Ann Kelly said Nevada is better off than some other areas, due in part to its supply sources, pipeline capacity, cost-control practices and other factors.

The commission "intends to keep vigilant on its oversight to keep natural gas prices as low as possible during these critical times," Kelly added.

Among the other orders was one updating a consumer "bill of rights." Among other things, the bill provides that utilities can't cut off service due to nonpayment when temperatures drop below 25 degrees in southern Nevada and 15 degrees in northern Nevada.

The temperatures are higher if a consumer is older than 62 or has documented health problems.

Also approved were letters to federal regulators noting volatile gas prices and supporting efforts to protect the market from manipulation.