The price for natural gas may be even higher next winter. Or
maybe not.

Officials at National Fuel announced Tuesday that customers’
monthly bills could go up 8.5 percent in August.

Nancy Taylor, senior manager of corporate communications,
explained that the figure was included in the company’s annual
Purchased Gas Cost filing with the Pennsylvania Public Utility
Commission for the period from Aug. 1 through July 31, 2007.

The company requested an increase in overall gas cost expense
totaling about $38,547,000 in this state-required filing. This
increase, if approved by the PUC, breaks down as follows: a typical
residential customer using 105,000 cubic feet of natural gas would
see an increase from $157.01 to $170.34 per month or 8.5
percent.

Taylor emphasized that this figure could change – either to the
good or the bad.

“It could be something different,” she said. “This request is
based upon current market conditions and reflects anticipated gas
costs for the period August 1, 2006, through July 31, 2007.

“Customers should remember that this is a forecast that must be
reviewed and approved by the PUC and could be revised before August
1.”

In other words, it’s anyone’s guess what will happen in August,
but news of the proposed increase comes at a time when customers
are already paying 41 percent more than what they were last year at
this time.

Last year, the company expected a 6.9 percent increase, but put
into place an 8.1 percent increase in August.

“They predicted an increase and did in fact implement an
increase,” Taylor said, adding the company puts its rates into
effect annually on Aug. 1. They can then adjust those rates
quarterly – in November, February and May – to account for changes
in the marketplace price of natural gas.

These costs, she said, amount to about 80 percent of the
customer’s winter bill which are shown in the “Gas Supply Charges”
section of the customer’s bill.

“At this point, it’s based on data available in the middle of
December,” Taylor said. “Our next opportunity to adjust gas cost
rates will be February 1. Any change at that time would cause us to
revise our projected figures for August.”

The prediction, she said, boils down to basic economics.

“Supply and demand,” Taylor said. “As there is a larger demand
for a limited supply of natural gas, the price is going up.”

Taylor said that natural gas has become “the fuel of choice”
since it’s environmentally friendly and is even being used in power
generation plants.

Before, natural gas prices were only affected by a cold, harsh
winter. Now, since electric plants could be using natural gas, the
price is affected in the summer months when air conditioners are
used.

The filing with the PUC not only includes the projected price,
but also how they purchase the gas.

“They are looking at our gas purchasing practice as well as the
price,” Taylor said. “Their job is to ensure that we are doing our
best to get the best price for our customers.

“It’s more important how we do it than what the dollar amount
is,” she said, adding their filings are generally approved by the
PUC.

Taylor said the company tries to get the price using a multitude
of methods, including long-term and short-term contracts.

“We try to establish a mixture of types of purchases to assure
the supply and also to assure the lowest possible price for that
supply.”

Taylor reiterated that those having trouble paying their bills
can get on the budget plan, which is open to everyone.

There’s also a summer break plan, for which people needed to
sign up by September.

In that plan, customers pay on the budget for 10 months and pay
their normal bills in July and August.

There are also billing options for low-income customers.

Those having trouble paying their bill can call toll free at
1-800-365-3234.