Questar proposes an approximate 300% rate hike for larger businesses


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SALT LAKE CITY — Questar Gas has proposed a more than 300 percent rate hike for their natural gas services for businesses. Some local companies, however, said they are worried about what the rate hike might do to their bottom line.

Questar officials said the proposed rate hike would only affect customers in certain rate classes. The majority of Questar users fall into the the general service class, which includes homes or small businesses. Some companies that use larger quantities of gas, like businesses that deal in mining or manufacturing and select schools, receive a discounted rate called a transportation rate.

Dunford Bakers in West Jordan has been baking donuts for two decades. When the rate hike was proposed a week ago, the company's Chief Financial Officer Dale Hatch said he immediately became worried.

"We haven't planned on that, and it's difficult to deal with," Hatch said. "Any significant, substantial increase in utility costs will have a major impact on the bottom line because it's difficult to raise donut prices and be competitive with large, national companies."

Questar said the rate hike is unavoidable. A representative said many businesses may use another gas company out of state and Questar charges a fee to those businesses. The gas company's pipes are used to deliver the gas.

That fee is the increase Questar is proposing.

Questar said many larger customers recently moved out of the more expensive General Service rate class to the cheaper transportation rate class and they need to make up lost revenue.


Any significant, substantial increase in utility costs will have a major impact on the bottom line because it's difficult to raise donut prices and be competitive with large, national companies.

–Dale Hatch


"When we have so many make that move into a different rate class, that changes the revenue requirement," Questar spokesperson Darren Shepherd said. "We're not able to collect the amount of money we need to operate our system."

The Granite School District would be one of the businesses that will potentially face an increase in rates. Several of their schools fall into an the higher transportation rate class.

"The impact could be anywhere between $20,000 to $100,000 based on what we've been able to calculate thus far," Granite School District representative Ben Horsley said.

It could be eight months before the Public Service Commission makes a ruling on Questar's request. They could go with the proposed hike, say no to it all, or negotiate a middle option.

Contributing: Dave Cawley

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