October 16, 2008
CLARKSBURG, W.Va. - Dominion Hope announced today it has filed a request with the West Virginia Public Service Commission for an increase in the base rates it charges for natural gas service that would increase the average residential bill by about $21 a month. Dominion expects the commission to hold public hearings in the near future, then issue a decision that would affect bills next summer.
The company also announced today that the commission has authorized it to decrease its purchased gas rate by $1.79 per thousand cubic feet (mcf), effective November 1, lowering the average residential bill about $11 per month.
Natural gas bills are comprised of two parts, the base rates that pay for delivery of natural gas, and the purchased gas cost rate that covers the cost of natural gas purchased for the customer.
The lower purchased gas rate would reduce the residential customer’s total rate from about $16.50 to $14.71 per thousand cubic feet. This would reduce the monthly bill of the average residential customer using six mcf per month from $108 to $97. Lower national prices for natural gas are the primary reason for the lower purchased gas rate. Dominion Hope does not make a profit on the natural gas it purchases for its customers.
Dominion Hope is requesting an increase in base rates because of increased expenses such as pipeline maintenance, construction, taxes, employee benefits and salaries. The requested new base rates would increase revenues by $34.4 million and would increase the monthly bill of the average residential customer using six mcf per month from $97 to $118, or 21 percent. Residential bills include both a monthly charge and a usage charge.
The average monthly bill would increase 12 percent for commercial customers, 32.6 percent for industrial customers and 14 percent for resale customers.
Dominion Hope’s customers have enjoyed stable base rates for fifteen years, with increases well below the rate of inflation. Since Nov. 1, 1993, Dominion Hope’s base rate for residential customers has risen only 49.5 cents per mcf, an average increase of only 1.37 percent per year over the last fifteen years. Over the same time period, the U.S. Department of Labor’s Consumer Price Index has increased an average of 3.3 percent per year. At the same time, the Dominion’s investment to provide service to its customers has risen 64 percent, from $147.8 million as of January 1, 1992, to $242.6 million at April 1, 2008.
Anyone desiring to protest or intervene in the base rate request filing should file a written protest or petition to intervene with the commission. Correspondence should be addressed to The Executive Secretary, Public Service Commission of West Virginia, P.O. Box 812, Charleston, West Virginia, 25323.
Dominion Hope, a subsidiary of Dominion (NYSE: D), has about 115,000 customers in 32 counties. Dominion, headquartered in Richmond, Virginia, is one of the nation's largest producers of energy, with a portfolio of approximately 27,000 megawatts of generation. Dominion serves retail energy customers in 12 states.. For more information about Dominion, visit the company's Web site at http://www.dom.com.
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