Commission Orders Returns of $32 million to NW Natural Customers

“Under normal conditions we would make this adjustment in the fall, but these are not normal times” - Commission Chairman Lee Beyer

Salem-News.com

(SALEM, Ore.) - Customers of NW Natural gas will receive a one-time refund that will reduce their rates by 3.4% effective June 1, 2009.

Tuesday, the Oregon Public Utility Commission ordered the return of $32 million to customers because NW Natural has saved money when it bought natural gas on the wholesale market between November 1st 2008 and March 31st 2009.

“With many households facing challenges to pay their bills we want these savings passed along as soon as possible,” Commission Chairman Lee Beyer said.

“Under normal conditions we would make this adjustment in the fall, but these are not normal times.”

For example, a residential customer who used 92 therms per month during this five month period would receive a credit of approximately $33.00. A commercial customer that used 383 therms per month would receive approximately $137.00.

Last summer the US natural gas price hit an all-time high due to an increase in demand and widespread worries about future domestic gas supply availability.

In the intervening months that price has dropped by nearly half. “The drop in prices is the result of a massive increase in US gas supply (mostly from unconventional drilling) and a substantial decrease in demand for gas due to the economic recession and improved energy efficiency,” said Commission analyst Ken Zimmerman.

“Prices are expected to rise if the summer is warmer than normal due to increased demand for gas-fired electric generation for air conditioning or winter is colder than normal. But prices are expected to remain below what we saw in 2008.”

The Commission will make it annual Purchased Gas Adjustment (PGA) this fall to reflect the actual cost of the wholesale price of natural gas for Oregon’s three natural gas companies. This allows the companies to pass through their actual cost of purchasing gas. There is no markup of the price.

Source: Oregon PUC