Atmos Energy, the company that provides natural gas service to Southwest Colorado, has asked the Colorado Public Utilities Commission to approve an increase in its base rate, or facility charge.
The utility is requesting a three-tiered rate increase over the next two years.
The first stage would be a 9 percent increase, or approximately $3.54 per month for the average residential customer in Southwest Colorado, on June 10.
Rates would rise an additional 4 percent ($1.69/month) on July 1, 2014, and another 4 percent ($2.02 per month) on July 1, 2015.
The first increase for commercial customers would be less than 1 percent, or approximately $.35 per month for the average commercial customer, with additional increases of 4 percent during each of the next two years.
Atmos last received an increase in base revenue in 2008, company spokesman Brian Martens said.
The base charge pays for infrastructure maintenance and improvements, operational costs such as billing and distribution, and a return on investments.
Atmos, by law, can’t make a profit on the actual commodity, natural gas. Increases or decreases in the wholesale price of gas simply are passed along to customers. Natural gas production in the United States is booming, and in 2012, Atmos customers benefited from two commodity-price reductions: 18 percent in April and 3 percent more in October.
“The commodity cost is a pass-through,” Martens said.
But although the price of gas itself is dropping, the cost of delivering service is not.
“The economy has been stagnant,” Martens said. “We’ve faced increased costs, specifically the cost of meeting federal guidelines for pipeline safety.”
The increases would augment Atmos’ statewide annual revenue by $4.1 million (4.8 percent) with this year’s increase, $2.9 million (3.3 percent) with the 2014 increase and $3.5 million (3.8 percent) with the 2015 increase.
“An increase is now necessary to keep pace with higher operational costs, to make considerable improvements in our infrastructure and to earn a fair return on our assets,” Gary Gregory, president of Atmos Energy’s Colorado-Kansas Division, said in a news release Wednesday.
Atmos Energy, headquartered in Dallas, serves about 110,000 natural-gas customers in 65 Colorado communities.
Nationally, Atmos has more than 3 million customers in 1,400 communities from the Blue Ridge Mountains in the East to the Rocky Mountains.
