September 18, 2007 in City

Avista seeks cuts in natural gas rates

By The Spokesman-Review
 

An Avista proposal would cut natural gas bills this winter for its customers in Washington and Idaho, as costs for the heating fuel have fallen.

The Spokane-based utility seeks a 6 percent decrease in Washington, which would lower the average customer’s bill by $5.32 a month.

In Idaho, a 4.6 percent rate cut sought by Avista would lower average bills by $3.65 per month.

Average Idaho bills are lower than those across the state line – $75.14 a month versus $83.49 in Washington, according to Avista. States have their own sets of regulations and taxes that guide final rates that customers pay. In addition, the average Idaho resident uses less natural gas than the average Washington customer.

“This is the first decrease in several years and we’re happy for our customers,” said Avista spokeswoman Debbie Simock.

The cost of natural gas has tripled in the past decade amid a wildly fluctuating market.

This year’s slight drop in price is due partly to Avista increasing its storage capacity and adhering to a disciplined gas purchasing plan. About 70 percent of the gas burned for home heating is purchased before residents turn on furnaces.

Though the natural gas market remains volatile, Avista said the absence of interruptions during this hurricane season has put downward pressure on prices. Natural gas futures contracts traded on the New York Mercantile Exchange are based on prices from the Henry Hub in Louisiana. The hub is a point where multiple pipelines interconnect.

Avista has about 141,000 natural gas customers in Washington and 70,000 in Idaho.

About 80 percent of a homeowner’s gas bill is based on gas prices and pipeline costs. The remaining 20 percent covers Avista’s distribution costs.

Avista’s requests will be considered by the Washington Utilities and Transportation Commission and by the Idaho Public Utilities Commission. If approved, the changes would take effect Nov. 1


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