News Releases

Open House and Consumer Session Scheduled on Sierra Pacific's Request to Recover Higher Natural Gas Costs

Sep 13, 2001

Sierra Pacific Power Company
Contact: Faye Andersen
Phone: 77-834-4822

For Immediate Release

Customer information, energy conservation advice and answers to questions about your utility bills are part of an open house that Sierra Pacific Power Company will be hosting Monday, Sept. 17, from 4-6 p.m. at the Reno-Sparks Convention Center, 4590 South Virginia Street, Room B-20. The open house is in advance of a Consumer Session scheduled by the Public Utilities Commission of Nevada (PUCN) at 6 p.m. that evening to take customer comments on a request by Sierra Pacific to adjust its natural gas prices to reflect the higher costs the company has paid to purchase natural gas on behalf of its customers.

On June 29, the company filed to recover fuel costs that would adjust natural gas prices by 55 percent for residential customers. Under this proposal, the gas bill for a typical residential customer who uses 60 therms of natural gas per month will rise by $27.43 (from $49.90 to $77.33). Even with this increase, Sierra Pacific residential customers will be paying the lowest price for natural gas in northern Nevada (based on an average usage of 60 therms per month).

"Our request is the direct result of what has happened regionally to the price of natural gas over last fall and winter," said Mary Simmons, vice president of rates and regulations for Sierra Pacific Power. She indicated the request was made to the PUCN in June and covers the increased costs of gas supplies from August 2000 through April 2001.

Simmons explained that Nevada regulations handle these gas prices through a Purchased Gas Adjustment, which requires utilities to purchase the gas on behalf of customers, keep track of the expenses and then seek reimbursement based on actual costs.

"We're trying to recover costs we've already paid to keep natural gas flowing to our customers, there's no profit in it for us," she said."This is a dollar-for-dollar pass- through for the cost of gas and we're just seeking reimbursement for money already spent."

Natural gas prices, fueled by an energy crisis in the West, reached historic levels last fall and winter. Increases in natural gas prices nationwide were a result of growing demand, coupled with tight domestic supplies and volatile prices for other energy resources. Lower prices are passed through to customers using this same process.

Simmons said that she's encouraged at what looks like falling gas prices in the future, while underscoring the fact the company is seeking to recover costs for purchases made on behalf of customers when prices were two-to-three times the cost today.

According to Simmons, a customer's bill for natural gas is determined both by the price paid for the gas itself and by the amount of gas used. As a result, many customers have the ability to control their bills by reducing their gas usage. She encouraged customers to attend Sierra Pacific's open house where energy experts will be on hand to discuss ways in which to conserve natural gas and electricity usage in homes and businesses. Customers with questions about their bills can also get answers during the open house.

In addition to considering comments made during the consumer session, a review by the PUCN will be completed before any adjustments to Sierra Pacific's prices can become effective. A decision on Sierra Pacific request is expected sometime in the next few months.