SourceGas rate increase approved by PUC

MONTROSE — Local natural gas customers will see a general rate increase in their utility bills starting in September.

SourceGas Distribution LLC announced Thursday that the Colorado Public Utilities Commission (CPUC) approved a general rate increase to the non-gas component of its rates effective Sept. 1.

The bill for a typical residential customer will increase about $3 to $12 per month; the rise in cost could be lower or higher depending on the amount of gas individual customers use, SourceGas said.

Customers may see two line items on their September bill, splitting the charges during the billing period for before and after the rates become effective, said Natalie Shelbourn, SourceGas spokesperson in Delta. She said the company doesn’t have any pending increase requests.

This latest announcement comes after recent warnings that consumers should anticipate an overall jump in winter energy bills. Private and nonprofit groups have urged consumers to begin preparing for the higher costs by updating their heating equipment, working with their local utility companies and seeking assistance funding.

Combined gas and electricity bills are expected to increase 15 to 20 percent from last year, said Skip Arnold, executive director of Energy Outreach Colorado, a nonprofit group that helps families pay their energy bills. For low-income households, out-of-pocket expenses after assistance may increase 20 to 30 percent, he added.

The last general rate increase in Colorado was filed 14 to 18 years ago depending on the service area, SourceGas said. The new rates will help offset significant increases in the costs associated with providing natural gas service to approximately 85,000 SourceGas customers across Colorado.

“We have been able to operate without increasing the distribution rates for our customers for many years and make service improvements by effectively managing our costs,” Dan Watson, SourceGas president and CEO, said in a statement.

“We are committed to working safely, responsibly and to keep costs in check for our customers,” Watson added. “A thorough analysis, however, has demonstrated that we cannot continue to absorb these higher costs and must adjust our rates in order to keep pace.”

This increase affects the non-gas component of a bill, including the monthly customer charge and volumetric distribution charge, SourceGas said. The customer charge is the same month-to-month. The distribution charge is a fixed rate that is applied to the amount of gas used each month.

According to SourceGas, the increase does not affect the largest portion of the bill, the natural gas commodity costs, which are based on market prices and currently account for 70 to 80 percent of the total monthly bill.

“The newly approved rates also shift a portion of non-gas costs away from that part of the bill that is tied to volume fluctuations,” Watson said in the statement. “This will help stabilize customer bills, reduce the impact of winter heating bills by spreading more of our cost recovery over the rest of the year and lessen the impact of the volatile commodity prices we’ve seen recently.”

Additional information is available online at http://www.sourcegas.com/CO.aspx.

Low-income individuals and families in need of energy assistance can call 1(866) HEAT-HELP.