Average customer will pay $20 less a month on home heating bill
Homeowners in Southwest Washington who use natural gas to cook and heat their houses will see a rate cut of more than 20 percent from Northwest Natural Gas Co., starting Monday.
State regulators on Thursday approved the change that will decrease residential rates by 21.9 percent and commercial rates by 22.8 percent, the Portland-based utility’s lowest rates in five years.
The average NW Natural customer will pay $20 per month less on his home heating bills this winter, cutting the monthly bill to $70 from about $90. Commercial customers will see an average savings of almost $88 per month on their natural gas bills.
This marks the second time this year that the Washington Utility and Transportation Commission has approved rate cuts requested by Northwest Natural.
NW Natural in May issued a one-time refund totaling $4.3 million to customers due to an unexpected drop in wholesale natural gas prices. Part of that was issued as a lump sum in June and the rest is subtracted from customers’ monthly bills, said Mike Parvinen, assistant director for energy at the WUTC.
Any unexpected price changes from the previous year get pushed into utility rates along with the predicted wholesale cost of natural gas for the coming year.
Gas prices are expected to rise slightly next year and then remain level for the next few years, said Parvinen. NW Natural included the slight rise in gas prices in its current rate request so the WUTC doesn’t expect rates to rise significantly next year.
The one-time refund is set to end next year, however, and customers should expect a slight rise in their 2011 utility bills as a result, Parvinen said.
NW Natural can’t predict rates for 2011, but “certainly global and national gas supply looks good,” said Jenna Cooper-Gross, a spokeswoman for NW Natural.
Washington ratepayers will also see a new charge on their monthly utility bill of about $1 starting Nov. 1, 2011, for the utility’s new energy efficiency program.
Additional savings
NW Natural in August requested a residential rate decrease of 21.5 percent, but later revised the amount to a slightly larger cut when gas prices fell again.
“We’ve been able to capture additional savings since we filed,” said Cooper-Gross.
The Oregon Public Utility Commission, which oversees a separate rate structure than the WUTC, this month approved a 16 percent rate cut for its ratepayers, compared to the utility’s requested decrease of 14.5 percent.
Regulators require natural gas companies to adjust rates periodically as wholesale prices change. About two-thirds of a NW Natural customer’s monthly bill comes from the cost of natural gas and the company isn’t allowed to collect a profit on that portion of the bill.
NW Natural serves 67,862 residential and business customers in Clark, Skamania and Klickitat counties.
