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SALT LAKE CITY (AP) -- Questar Gas is seeking a 20.3 percent rate hike, increasing the typical residential bill by about $18 per month.
The rate increase, if approved, would be effective Nov. 1, the company said Tuesday.
The request replaces a 13.4 percent increase that the company sought last month, but then asked to be delayed pending assessment of "hurricane-related market volatility."
It follows a 14.4 percent increase that went into effect on June 1, and a 3.2 percent increase that was effective Oct. 1 and was due to the reversal of a gas-processing refund.
It said the increase is needed to cover the higher costs of purchasing natural gas. The company typically asks the state Public Service Commission twice a year to adjust rates to reflect the changing cost of gas purchased by Questar Gas.
"Those costs are passed on to customers with no markup," said Allan Allred, Questar Gas president and chief executive officer.
He said market prices for natural gas in the Rockies have more than doubled over the last year, due to rising global oil prices and supply constraints, including hurricane damage to gas-production facilities.
Allred said half of the company's supply comes from company-owned gas reserves, without which Questar Gas would be seeking a 60 percent rate hike.
The cost to develop and produce company-owned gas is less than $4 per decatherm, while purchasing gas from other suppliers is running more than $10 per decatherm, he said.
Since 1988, the residential gas bill as a percentage of household income has increased from 1.58 percent to about 1.62 percent and with the new rate hike will go to 1.95 percent.
The company's request was announced one day after parent Questar Corp. declared a 22.5 cent quarterly common stock dividend, the company's 244th consecutive dividend without a reduction.
(Copyright 2005 by The Associated Press. All Rights Reserved.)
