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City gas rates going up

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Average residential customer to see $6 a month hike

By Martin Salazar

City natural gas customers are being told to expect higher gas charges beginning this month.

The issue took center stage during Monday evening’s City Council meeting.

“The rates are going up due to what’s beyond our control,” City Utilities Director Ken Garcia said, explaining that the city’s supplier, Zia Natural Gas Company, is raising its gas rates.

According to the city, residential customers can expect to see their bills increase by about $6 a month, based on an average use of 5.6 MCF, or thousand cubic feet of natural gas. The city estimates that small commercial customers will see an increase of about $25 a month, based on an average use of 25.5 MCF.

The rates are automatically set each year by a formula contained in an ordinance adopted by the Council five or six years ago. Among the factors in that formula is the amount the city is being charged for the gas by its supplier and transmission costs.

Zia is actually raising its rates by 18 percent, but over the last year, the city has been able to reduce the amount of gas lost in its lines, and that is enabling the city to keep the increase to 11.8 percent, Garcia said. The amount of unaccounted for gas dropped from 5.2 percent to 2.1 percent.

The city also charges a base $10 fee per meter, and it imposes a cost of service charge to pay for operation and maintenance of the gas utility.

The cost of gas fee is increasing from $3.83 per MCF to $4.35 per MCF. The city’s cost of service fee is increasing from $2.99 to $3.02. The increase in the cost of service fee is based on the consumer price index.

Councilwoman Tonita Gurule-Giron said she doesn’t believe the city is doing enough to help struggling natural gas customers, insisting that the city had promised to do so.

“Where is the city now that the constituents need them?” she asked.

Garcia responded that while the city did promise to implement a program to help low-income customers with water bills when those rates were increased, there was no promise made to help customers with their gas bills.

But he said the city is telling struggling customers about the low-income energy assistance program, a federal program that helps low-income individuals with heating costs.

Garcia also added that the city’s gas rates are actually down from where they were in 2008, 2009, 2010, 2011 and 2012. Last year, the city actually lowered its gas rates.