Cut in Fuel Cost Erases Earlier Gas Rate Hike

The California Public Utilities Commission showed Friday that what it gives one day in the way of rate increases, it can take away in the form of rate reductions on another day. The result will be slightly lower rates next year for Southern California Gas Co. customers.

On Wednesday, the PUC approved a 1.9% cost-of-living increase, effective Jan. 1, but delayed a decision on how to adjust rates to account for the lower prices that Southern California Gas Co. now pays for fuel.

Increases Offset

Those adjustments, determined Friday, more than offset Wednesday’s increase. The PUC trimmed the gas company’s authorized annual revenues by $107.7 million, or 2.3%. This will reduce the average residential bill, based on 88 therms of energy, by 57 cents, to $38.63, a spokesman said.

The reduction will come in what is called the second-tier rates for residential and small commercial customers. (Bills are based on two rates--a “base line” allotment of gas at a rate 85% below costs, and a substantially higher rate applied to fuel consumption above the base-line level.)

Southwest Gas Corp., which serves the Victorville, Barstow and Big Bear areas, saw its request for a 9.9% cost-of-living raise trimmed to $2.6 million from $3.7 million, then offset completely by lower fuel costs, leaving rates unchanged.

Southern California Edison was granted a $92-million increase in electricity rates on Wednesday, a 1.9% revenue boost. This was originally reported by the PUC, erroneously, as a $146.3-million or 2.9% increase.

San Diego Cuts

Finally, in San Diego County, customers of San Diego Gas & Electric will benefit from far larger slashes in revenues, lopping $3.61 from the present $48.66 typical monthly bill of a residential customer who uses 400 kilowatt hours. The PUC trimmed 11 cents a month from the typical monthly gas bill of $17.46 for 40 therms.

That reduction stems mainly from an improved economy and declining natural gas and other fuel costs, reduced inflation and lower interest rates.