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Natural gas bills about to increase

Thursday, January 15, 2004 | 12:00 a.m. CST; updated 4:09 a.m. CDT, Tuesday, July 22, 2008

Elizabeth Simons, a Moberly resident, already has difficulty paying her gas bill.

“I just can’t afford it,” she said. “I don’t think they’re (AmerenUE) talking those who are low-income into consideration.”

Simons said her gas bill was $74 last month and she has not used her furnace this winter. However, her hot water heater operates on gas. To warm her house, Simons said she uses electric space heaters.

Now, Simons can expect an increase in her gas bill. Starting on Feb. 15, Columbia consumers who use natural gas for their furnaces or water heaters will be subject to an average rate increase of $6.55.

On Tuesday, the Missouri Public Service Commission approved a settlement allowing AmerenUE to increase operating revenues by $13 million annually. The increase will be reflected in the bills of their 130,000 natural gas customers in Missouri.

On May 23, AmerenUE filed with the Missouri Public Service Commission to increase their rates by $26.7 million in response to rising infrastructure costs.

Since May 2000, AmerenUE has replaced about 55 miles of old cast iron pipes and more than 3,000 service lines with modern, more durable pipe, according to Susan Gallagher, an AmerenUE spokeswoman. Most of these infrastructure changes were made to comply with state regulations.

“It’s a recovery of the money we spent to operate and maintain our natural gas lines,” said Erica Abbett, an AmerenUE spokeswoman.

"We seek increases to be put into customers’ rates because we are basically maintaining the infrastructure that delivers the gas to them.”

After AmerenUE filed for the increase, both the Public Counsel and the public service commission conducted an audit of AmerenUE, according to Doug Micheel, deputy public counsel. From these audits, they concluded the company needed between $10.5 and $11.5 million to cover infrastructure costs, not $26.7 million.

A settlement of $13 million was reached on Dec. 10 between AmerenUE and the public service commission, the Office of Public Counsel and the Missouri Department of Natural Resources. The terms of this settlement were approved Tuesday by public service commission on Tuesday.

“We worked with all of the parties involved to come up with a solution that would be good for consumers, but fair to us,” Gallagher said.

Some low-income consumers fear the price increase will result in a loss of utilities, or worse, make them homeless, according to Mary Hussmann, the leader of GRO-Grass Roots Organizing. Families in public housing, by contract, have to keep their utilities on, and if they don’t, they could lose their homes.

“This is not just a low-income issue, it is an issue for all people,” Hussmann said. “When shut-offs occur because of the rate increase, AmerenUE is allowed to charge everyone else for the money they don’t get because that person got shut off.”

In an attempt to accommodate the needs of low-income residents, AmerenUE agreed to contribute $155,000 per year to help fund a weatherization program developed in 1997 by the public service commission staff, Office of Public Counsel and DNR. Money from this program is used to pay for energy audits and installation of energy-efficiency measures for low-income homes.

“If there’s going to be a rate increase, we think customers should benefit from energy-efficiency programs that would help them reduce their energy cost,” said Kerry Cordray, spokesman for the DNR. “It’s part of our mission to promote energy efficiency as a way to help the customer who is going to be dealing with higher rates.”

In addition to this provision, AmerenUE had to commit to five others in order to get the final approval. These provisions include:

n Any changes in the Purchased Gas Adjustment will not be reflected in consumer’s bills until after April 1.

n Missouri gas delivery rates will not change before July 1, 2006.

n Investments in gas infrastructure improvements between July 1, 2003, and Dec. 31, 2006, will total at least $15 million.

n The company will provide $100,000 in annual funding for a pilot program offering weatherization services and rate relief to low-income customers in Missouri counties of Stoddard and Scott.

n The company will provide $55,000 per year to fund an energy-efficient equipment program.


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