The City Council has approved a 27% rate increase for 126,000 residential customers of the Long Beach Gas Department.
The increase, effective Dec. 1, was sought because of declining commercial revenues caused by falling oil prices, said Ralph G. Kortz II, gas company general manager. For example, the gas company's largest commercial user, Southern California Edison Co., last year purchased $40,000 worth of gas a day but now buys $4,000 worth of gas a day, Kortz said.
Without the rate increase for residential users, "we'll be looking at a gas department that will be out of business in two years," Kortz told the council Tuesday.
For an average single-family residence of four people, the annual price of gas will rise from the current $334 to $424, Kortz said. Despite the increase, Long Beach residential gas customers will still have relatively cheap rates, Kortz said. A recent nationwide survey by Gas Daily, a trade journal, showed that Long Beach's new rates were the fifth cheapest of 50 surveyed cities, according to documents submitted to the City Council by Kortz.