Colorado Rate Filing
March, 2008
SourceGas Distribution LLC (SourceGas) announced it has filed a request with the Colorado Public Utilities Commission (CPUC) to increase the non-gas component of its rates to cover the increased costs associated with providing natural gas service to approximately 85,000 customers across Colorado. The last increase in the non-gas base rates for the various Colorado service areas, which covers items such as infrastructure, equipment, labor, materials, billing, and safety services, was between 1990 and 1994.
SourceGas has been able to maintain the distribution rates for our customers for many years and make service improvements by effectively managing the business and our costs through the improvements made to the system, which include the implementation of a mobile dispatch system, automated meter reading and a centralized call center have helped keep costs in check for customers. 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.
The non-gas component of a monthly bill includes a fixed customer monthly charge and a volumetric charge, which varies from month-to-month depending on the amount of gas used. SourceGas proposes a higher fixed monthly customer charge and a higher volumetric charge. The request does not affect the largest portion of a customer’s bill, the natural gas commodity costs, which are based on market prices and account for 70 to 80 percent of the total monthly bill. Shifting these non-gas costs away from the portion of the bill that is subject to fluctuations will help stabilize customer bills, reduce the impact of winter heating bills by spreading more of our cost recovery over a full year and lessen the impact of the volatile commodity prices we’ve seen recently.
The company proposes that the filed rates will become effective April 4, 2008. However, this request is subject to suspension by the Colorado Public Utilities Commission while the filing is being reviewed.