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Gas Bills This Winter May Top Last Year's

October 08, 2003|Nancy Rivera Brooks | Times Staff Writer

California natural gas utilities warned Tuesday that winter probably would bring another round of big bills, with estimates running from 5% to 30% larger than last year.

Swelling bills reflect higher wholesale prices, which will be felt across the country, the U.S. Energy Department said Tuesday. Winter heating costs will rise about 5% nationwide for homes using natural gas but could jump even more if temperatures turn lower than anticipated, the department said.

"Weather is always a big factor," said Neil Gamson, an economist with the Energy Information Administration, a research arm of the Energy Department. "One of the things we always look for is what the fall is going to be like."

Forecasting gas bills is a tricky business -- akin to guessing where the stock market will end up -- because of weather vagaries as well as fluctuations in the market for natural gas.

With natural gas largely deregulated, the wholesale commodity price is passed along without markup each month to consumers. For a typical residential customer of Sempra Energy unit Southern California Gas Co., the commodity price makes up about 50% of each winter bill, with the rest coming from gas transmission and other charges.

The outlook for this winter is significantly less gloomy than projections made earlier in the year, when natural gas storage levels, depleted by high demand during cold weather in the East and Midwest, were approaching record lows. A temperate summer meant that less gas was burned to generate electricity to run air conditioners, which allowed gas storage to return to normal, Gamson said.

In Southern California, gas reservoirs are nearly full, and "we fully expect to be able to meet our customers' needs," said Denise King, spokeswoman for Southern California Gas.

Based on industry and EIA projections of wholesale gas prices, the typical Southern California Gas residential customer will see winter bills rise between 5% and about 12%, King said.

At the high end, a single winter monthly bill for the typical single-family home using about 75 therms might increase to about $73 from $65 a month last winter, she said.

(In the utility world, winter runs from November through March. A therm is one-tenth the standard wholesale measure of 1 million British thermal units.)

An average apartment dweller using 30 therms a month can expect an increase of as much as 11%, to $30 a month from $27. For a small business using 300 therms a month, the bill might be $300, compared with $270 a year earlier.

"It's still early. We have to see what the weather and the prices do," King said.

In PG&E Corp. territory in Central and Northern California, average winter bills will rise about 20% to 30%, spokesman Jason Alderman said. The utility has not forecast average projected bills by customer type, he said.

The bill increase was expected to be larger in the north because last winter was unusually warm and gas usage was lower, Alderman said.

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