Gas Co. requests increased gas rates
The utility is asking the PUC to allow an 8.4 percent rise
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Besides electricity, fuel and goods, the cost of gas could now go up as well.
The Gas Co. filed a request yesterday with the state Public Utilities Commission seeking an increase in utility gas rates on Kauai, Maui, Molokai, Lanai, Oahu and the Big Island.
If approved, the new rates -- about $10.62 extra per month -- would affect 35,000 utility customers, which is about half of the company's total customers.
The Gas Co. cited increased operational and maintenance costs as well as capital investments and the need to comply with new federal regulations as the reasons for the rate increase.
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The Gas Co. filed an application yesterday with the state Public Utilities Commission requesting an increase in utility gas rates on the islands of Oahu, Maui, Hawaii, Kauai, Molokai and Lanai.
Feeling the pinch
Utility customers affected: 35,000
Overall increase: 8.4 percent, or $12.5 million
Additional costs: $10.62 per month, or 35 cents a day
Average residential bill: $70 per month
Source: The Gas Co.
It is the company's first request for a rate adjustment since 2000.
The company cited the need to recover increased operational and maintenance costs as well as capital investments, renewable energy projects and compliance with new federal regulations as reasons for the rate increase.
If approved, the new rates will affect 35,000 utility customers, about half of the company's 67,000 customers.
Utility customers are typically those who are served by an underground pipeline. Nonutility tank customers and bottled-gas customers would not be affected by the increase.
The new rates will not appear on customers' bills until mid-2009.
Catherine Awakuni, the state's consumer advocate, said it was too soon at this time to say what her recommendation would be to the PUC. The investigation period could take several months, she said. Mainly, the state will want to determine whether the proposed increase is reasonable based on the company's expenses.
"We'll be able to make a recommendation to the PUC as to whether it's reasonable or justified after we review the application more thoroughly and after we've had a chance to conduct some discovery," she said.
Stacey Djou, the PUC's chief counsel, said a decision is expected in the middle of next year.
Overall, the Gas Co. is seeking an increase of 8.4 percent to utility customers, or $12.5 million.
If approved, the requested increase would add approximately $10.62 per month -- or 35 cents a day -- to the average residential bill of $70, or about 1 percent per year since the last increase.
"We have worked hard over the past decade to keep costs under control while continuing to invest in our pipeline and infrastructure," said Jeffrey M. Kissel, president and CEO of the Gas Co. "However, with the rising cost pressures of doing business in Hawaii and the importance of addressing Hawaii's energy issues, we can no longer defer our request for a rate increase."
Kissel added that the company has been able to keep its rate increase request to a minimum due to its strong focus on managing costs and targeting efficient energy practices across the state.
"We are committed to providing safe and reliable customer service and delivering one of the cleanest, most efficient sources of heat energy to our customers," said Kissel, "while playing a significant role in helping Hawaii cut its dependence on imported oil and reduce its energy vulnerability."
The requested increase is not related to increases in the cost of fuel, according to the Gas Co. Changes in fuel costs, up or down, are passed on to customers, without markup, in monthly bills.