Idaho Public Utilities Commission

Case No. INT-G-11-01, Order No. 32329

August 19, 2011

Contact: Gene Fadness (208) 334-0339, 890-2712

Gas rates could decline with Intermountain Gas request

The Idaho Public Utilities Commission is taking comments through Sept. 21 on an application by Intermountain Gas to decrease the variable portion of natural gas rates, the annual Purchases Gas Cost Adjustment (PGA), by an average 5.3 percent effective Oct. 1.

If approved, the weighted average cost of gas would be decrease from 49.2 cents per therm to 45.3 cents, resulting in an average $2.17 reduction per month for residential customers.

There are two major components to natural gas rates, a base rate and the PGA. Base rates cover fixed costs that rarely change. The PGA includes variable costs and is designed to more closely align actual rates with the variable portion of gas rates. The variable rates included in the PGA include: 1) the cost of purchased gas from suppliers, which is largely dependent on wholesale market prices; 2) the cost to transport natural gas and 3) the cost to store it.

Company officials say supplies of natural gas nationwide continue to remain strong with natural gas production at an all-time high.

The annual adjustment does not impact company earnings, whether the PGA is an increase or decrease. The amount collected in the PGA variable portion of rates can be used only to meet gas supply, transportation, storage and other related expenses and cannot go to increase company earnings.

The commission plans to handle this request in a modified procedure that uses written comments rather than conducting a hearing, unless customer comments can demonstrate a need for a public hearing. Comments are accepted via e-mail by accessing the commission’s homepage at www.puc.idaho.gov and clicking on "Comments & Questions About a Case." Fill in the case number (INT-G-11-01) and enter your comments. Comments can also be mailed to P.O. Box 83720, Boise, ID 83720-0074 or faxed to (208) 334-3762.

A full text of the commission’s order, along with other documents related to this case, is available on the commission’s Web site at www.puc.idaho.gov. Click on “File Room” and then on “Open Gas Cases” and scroll down to the above case number.