Atlanta Gas Light Co. (AGL) will be the first to say that warmweather and fixed prices can cause trouble. In a situation that hascaught the eye of Georgia’s Public Service Commission (PSC), AGL’snew unregulated rates have enraged hundreds of customers who,because of warm weather, have not used much gas, but still receivedwinter-like gas bills. The public outcry caused the PSC to schedulea vote on Jan. 5 to determine whether a hearing should be held toexamine re-regulating the state’s gas industry. If the commissiondecides a hearing is necessary, it will be held Jan. 26 with adecision to come shortly thereafter.
“With the extremely warm temperatures we’ve experienced thisfall, the timing couldn’t have been worse for unbundling,” saidPaula Rosput, President and COO of AGL. “If weather had been colderthan normal, the average customer would have noticed a lower costper unit of natural gas than last year.”
The controversy stems from a fixed demand charge AGL installedwhen the state deregulated. This charge, which is part of theconsumption charge on monthly bills, has increased the averageconsumer’s December bill 20-30% compared to the same period lastyear. AGL said that charges are necessary in order to recover costsexpended for reservation fees that ensure the delivery of naturalgas supplies to Georgia from interstate pipeline transmissioncompanies.
“In order to make it possible for competition to come in, AGLsustained extra costs that would not normally have been there. Weimplemented a fixed rate charge in order to recover those costs,”said Ross Willis, an AGL spokesman.
The PSC has a different view of the fixed demand charge. “Itlooks as though AGL is trying to collect as much as they can beforecustomers leave the system,” said Stan Wise, a PSC commissioner.”AGL is billing a year’s worth of charges over a five-month periodand the charges are based on what a customer typically uses, notwhat they actually use.”
Rosput had an answer for accusations that AGL is overcharging.”There is no basis for the suggestion that we are marking up thesecosts,” said Rosput. “In fact, we actually fell short on thecollection of these costs in the months of October and November.”
PSC spokesman Shawn Davis said the commission has receivedhundreds of calls from irate customers. “Here is one example. Thiscustomer paid an $800 gas bill last month. Guess how manydekatherms he used? None.”
Davis continued to say that customers could switch to analternate supplier to solve the problem “but we don’t want peopleto feel forced to switch. We’d like to see them take their time inchoosing somebody else.”
Since AGL opened their market in November, 128,000 people out ofa 1.4 billion person pool have switched to one of 19 certifiedsuppliers in the state. “AGL is charging 90% of their previouscustomer base too much,” Davis said.
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