Hearings on gas rate increase to begin

Kevin Rademacher

Monday, Sept. 19, 2005 | 10:18 a.m.

Public Utilities Commission hearings are scheduled to begin Tuesday into rate increase requests by Southwest Gas Corp. that could raise the average Southern Nevada customer's monthly bill by $6.50.

In May Southwest Gas asked the state Public Utilities Commission for a 2.8 percent residential rate increase in order to recover $11.3 million in past gas costs. That increase would push the average customer's winter bill higher by about $1.37 a month.

In order to meet higher natural gas costs in future months, however, the company would need to increase annual revenue by $53.5 million, pushing the average residential winter bill up by $6.50, or 13.4 percent.

PUC Commissioner Jo Ann Kelly, who will preside over the Southwest Gas rate case, last month attended a consumer session where a handful of utility customers voiced their concern over steadily rising costs..

"We do listen," she said at the August session. "These are important. You are heard."

Kelly also told the small crowd that we, unfortunately, live in an era in which natural gas prices are soaring, emphasizing the need for conservation.

"I know none of you want to hear it," she said.

Kelly told the small crowd that one of the major factors in higher natural gas prices -- which are traditionally associated with heating -- is the flood of new gas-fired electric power plants. She pointed out that 90 percent of the new electric generation in the Western United States is now gas-fired.

In November, regulators approved a $30.6 million rate increase for Southwest Gas. It was the fifth jump in Southern Nevada natural gas bills in 12 months.

In that case, the PUC elected to favor projected rates proposed by PUC staff instead of historical rates proposed by the utility. The move nearly doubled Southwest Gas' original request for a rate increase of $16.3 million, or 4.9 percent.

The rate hearings will be held at 10 a.m. at 101 Convention Center Drive, Suite 250, in Las Vegas.