Snohomish County residents could see their natural gas bills rise by almost 9 percent, or about $7 a month, if the state approves a new rate increase requested by Puget Sound Energy.
The adjustment is necessary to account for the rising wholesale cost of natural gas, the utility company said, even though spot prices for the fuel have declined sharply during the past eight months.
The problem is that price forecasts for the winter months ahead show increases coming.
“It’s a constant balancing act really,” said Roger Thompson, a Puget Sound Energy spokesman. “You kind of look at the rear-view mirror and out the windshield at the same time, and both of those things factor in when you file for an adjustment.”
The requested rate hike is a “purchased-gas adjustment,” meaning it will only be used to cover the higher cost of natural gas, PSE said.
The Washington Utilities and Transportation Commission is scheduled to vote on the request Sept. 27, said Marilyn Meehan, spokeswoman for the commission. If the commission decides, after reviewing evidence submitted by PSE, that the increase is justified, it would take effect Oct. 1.
For the typical residential customer, it would add $7.26, or 8.7 percent, to the monthly bill. The average household natural gas bill, when equalized over the year, would then total $90.29 per month. Commercial customers generally would see larger increases, PSE said.
PSE also filed a proposal with the utility commission to increase bill assistance to low-income customers by more than $1.2 million. To help increase that fund, which helps eligible electric and natural gas customers within the utility’s territory, the fee that all PSE customers pay for the program would go up by about 2 cents a month per household.
Because the cost of the fuel itself has risen repeatedly in recent years, Thompson said it now accounts for 70 percent of the average customer’s bill, while PSE’s charge for delivering the gas makes up the rest.
PSE blamed the higher wholesale prices on the increased use of natural gas to generate electricity during the summer and damage to natural gas production facilities by last year’s hurricanes in the Gulf of Mexico.
Dan Kirschner, executive director of the Northwest Gas Association, said wholesale prices have eased, however, after a steep rise last fall.
“We’ve had a softening of prices over the past few months. But the important thing to recognize is gas prices remain very volatile. … Little things can shock the system significantly.”
A year ago, in another purchased-gas adjustment, PSE increased rates for the average household by about 13 percent. The utility also has requested a permanent rate increase as well, though that is under consideration by regulators.
PSE serves most of Snohomish County. Cascade Natural Gas, which serves some north county residents, has not requested a rate increase.
Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.
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