Washington natural gas customers seeing higher energy bills
Natural gas customers in Washington started seeing higher energy bills beginning Nov. 1 due in part to last winter’s colder temperatures and a 2018 gas pipeline explosion in British Columbia.
The state Utilities and Transportation Commission recently approved rate adjustments ranging from 4 percent to 15 percent for Avista, Cascade Natural Gas, NW Natural and Puget Sound Energy natural gas customers.
Higher customer costs for 2019 reflect wholesale natural gas price increases caused in part by the October 2018 Enbridge pipeline rupture, which disrupted natural gas markets throughout the Pacific Northwest.
On Oct. 9, 2018, a 36-inch diameter natural gas mainline burst near Prince George, British Columbia. The pipeline serves markets in Canada, Washington, Oregon and Idaho with natural gas production from northeastern British Columbia through the Sumas hub, on the border between Canada and Washington state.
Imports of natural gas at the Sumas hub, which averaged 1.1 billion cubic feet per day in the first half of 2018, fell to zero for a day after the rupture.
About half of Washington’s natural gas supplies come from the Canadian provinces of British Columbia and Alberta.
Enbridge reported it successfully completed repairs on the ruptured section of the pipeline at the end of October 2018, but capacity delays continued through winter 2019.
Natural gas companies are required to submit purchased gas cost adjustment filings every 15 months to adjust rates based on the constantly changing cost of natural gas in the wholesale market. The cost of gas purchases are passed on to customers; companies do not profit from or lose money on gas purchases.
Here’s how the increases affect utilities across the state:
• The typical Cascade Natural Gas residential customer using 55 therms a month will see an increase of 10.8 percent, or $5.17, for an average monthly bill of $53.23. Rate changes for Cascade primarily are due to the purchased gas cost and decoupling mechanism, but they also include cost recovery for pipeline replacement, conservation programs, low-income assistance, and refunds related to excess deferred income taxes due to the Tax Cuts and Jobs Act. Kennewick-based Cascade serves more than 220,000 residential and business customers in 68 communities throughout the state, including Kennewick, Walla Walla, Sunnyside, Yakima, Wenatchee, Aberdeen, Bellingham, Bremerton, Longview, Moses Lake and Mount Vernon.
• The average bill for a typical Avista residential natural gas customer using 66 therms will increase by 14.8 percent, or $7.06 a month, for an average monthly bill of $54.85. Rate changes for Spokane-based Avista primarily are due to the annual gas adjustment, but they also include an adjustment for the company’s revenue decoupling mechanism, a regulatory tool that allows utility revenue to be “decoupled” from sales.
• The typical NW Natural residential customer using 57 therms a month will see an increase of 4.4 percent, or about $2.14 a month, for an average monthly bill of $51.06. Rate changes for Portland-based NW Natural primarily are due to the PGA, but they also include annual adjustments for low-income assistance programs.
• The typical Puget Sound Energy residential customer using 64 therms a month will see an increase of 14.1 percent, or $8.40, for an average monthly bill of $68. Rate changes for Bellevue-based PSE primarily are due to the PGA, but they also include cost recovery for pipeline replacement.
The variation in total gas rates among Washington’s investor-owned utilities is due to regional differences in monthly residential usage, supply sources, conservation and energy efficiency programs, low-income program costs, and company gas purchasing practices.
The state UTC regulates the private, investor-owned natural gas utilities in Washington. It is the commission’s responsibility to ensure regulated companies provide safe and reliable service to customers at reasonable rates, while allowing them the opportunity to earn a fair profit.