Gas-rate increase delayed until 2011 

Gas rates are going up next year, but customers may be able to keep their toes toasty through winter before seeing an increase in their bills.

Before a transmission pipeline blew up in San Bruno in September, PG&E was in the process of applying for an increase in gas rates to pay for its transmission and storage system, set to take effect Jan. 1.

The company had come to an agreement for a rate hike with consumer advocates in August and only needed the approval of a state agency before it went forward. But after the Sept. 9 explosion, the case slowed.

The California Public Utilities Commission’s administrative law judge, John S. Wong, asked all the parties to reassess whether the proposed rate hike would be enough to pay for improvements in the transmission system.

A month later, after the CPUC had come under criticism for failing to better monitor PG&E, Wong issued a ruling adding another phase to the rate-increase decision process to address gas transmission and storage safety concerns.

PG&E officials, worried the matter would not be settled by the new year, asked for the judge to make a decision before then.

Wong recently issued a proposed ruling stating that he would not promise to make a decision before January, saying there were still too many issues to be worked out. As a compromise, he agreed that whatever rate increase is finally approved will be retroactive to the beginning of the year.

For example, if the final decision were to be made the first of March, customers would maintain their current gas rate for January and February. But to make up for the lost revenue, the rates would be set even higher than the new rate for the rest of the year.

Residential customers are slated to see the highest increase, adding to their already considerably higher rates over commercial customers. As it stands, residential rates are 19 percent higher than small commercial rates and 45 percent higher than large commercial rates.

Higher bills for utility customers

PG&E is raising natural-gas rates to pay for its transmission and storage system.

Residential
Rates as of Aug. 1*: 13.946
PG&E’s initial proposed increase, December 2009*: 0.198
Settled increase, August 2010 (awaiting approval)*: 0.097

Small commercial
Rates as of Aug. 1: 11.707
PG&E’s initial proposed increase, December 2009: 0.192
Settled increase, August 2010 (awaiting approval): 0.094

Large commercial
Rates as of Aug. 1: Rates as of Aug. 1: 9.532
PG&E’s initial proposed increase, December 2009: 0.170
Settled increase, August 2010 (awaiting approval): 0.087

kworth@sfexaminer.com

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