Mich. Gas requests rate hike for next year

Thu, Jul 2, 2009    to del.icio.us

The Tri-Cities area's main supplier of natural gas has asked to raise its rates in 2010.

Michigan Gas Utilities filed a formal request with the Michigan Public Service Commission on Wednesday. If approved, the utility's overall rates would increase by 4.5 percent next year.

For the typical MGU residential customer, using 870 ccf (100 cubic feet) of gas each year, the increase would equate to $3.78 each month.

MGU spokesman Paul Livernois said the request is linked to several issues: increases to the cost of capital for financing, decreased sales, and increased costs of customer service functions and employee benefits.

"We know that even a small increase isn't welcomed news for our customers," Livernois said. "The good news is that the commodity price (which is the gas cost recovery factor on a customer's bill) has fallen considerably since last heating season, so the typical gas bill should be less this winter, assuming we have normal winter temperatures."

Livernois said the exact amount of any increase approved by the state commission that regulates utility companies may not be known until next summer, but an interim increase is slated to begin Jan. 1.