Public reacts to proposed gas rate increase

The utility reiterated its stance first stated at council’s April 1 luncheon: CU needs a 4.1 percent increase in natural gas base rates, which would raise the average residential bill by $3.91 per month. The bill for the average general-service customer – a group that includes nearly all business and industrial customers – would increase $14.58 per month.

Utility officials say the increase would fund an additional $5 million the utility needs for increased natural gas purchase costs and infrastructure improvements required by state regulators.

CU General Manager John Twitty said the increase would help the gas system pay its own way. He noted the gas utility has operated at a loss in four of the last six years, forcing CU to subsidize the system with revenues from the electric system.

“You don’t want to do that for a long period, because it means that the electric rates are higher than they should be,” Twitty told council. “We want to keep all of those costs as low as we possibly can. The easiest way to do that is to have them pay their own way.”

Eight members of the public voiced concerns about the increase. Robert Burnett, pastor of Central Baptist Church, said he worries the utility’s conservation efforts are penalizing those who use them.

“They want us to conserve energy and cut back, and then they penalize the citizens of Springfield for cutting back because they’re not selling as much gas as they anticipated they would,” Burnett told council. “What will CU do if citizens like me get more angry and continue working to lower the bills and they don’t sell as much gas as they anticipated? Are they going to come back next year and ask for another rate increase? It’s just wrong.”

Twitty said he doesn’t think the incentive programs penalize consumers, adding that 73 percent of the natural gas rate comes from the cost of the fuel itself.

“If you use less of the commodity, your bill is going to be less, and that’s what we’re trying to encourage customers to do,” he said.

Twitty also reiterated that the utility doesn’t have much room to safely cut its current budget, pointing to the fact that average rates are 20 percent lower than state and national averages.

Council is expected to vote on the proposed rate hike at its April 21 meeting.

See SBJ’s April 14 issue for more from the April 7 City Council meeting.