Going against sharp recent wholesale price declines, Portland, OR-based Northwest Natural Gas Co. filed with state regulators in Oregon and Washington Monday, seeking 14% and 20% rate increases, respectively. Because of the recent price drop, Northwest said the increases are “significantly below” the amounts projected last July.

In spite of the recent declines, Northwest said it was seeking the increases because its wholesale natural gas costs are still higher than they were a year ago at this time. The natural gas-only distribution utility made the filing to the Oregon Public Utility Commission (PUC) and the Washington Utilities and Transportation Commission (WUTC).

Northwest is seeking Nov. 1 effective dates for the rate changes from the PUC and WUTC.

In July, Northwest Natural was one of the three major natural gas distribution utilities serving Oregon to warn state officials they expected retail natural gas prices to increase this winter in the range of 10-40%. The state’s biggest distributor, Northwest, predicted hikes in the 35-40% range (see Daily GPI, July 17).

Northwest Natural told Oregon regulators at the time that it expected its retail rates to go up 35-40% this winter; Seattle-based Cascade Natural Gas, now a subsidiary of North Dakota-based MDU Resources, predicted its rates would go up 15-20%; and Spokane, WA-based Avista Utilities expects rates for its Oregon customers to rise 10-15%. Avista has subsequently refiled for a gas rate decrease (see related story).

“Natural gas prices reached all-time highs in July when we made our initial rate increase projection, but recently we’ve seen prices decrease,” said Randy Friedman, Northwest’s gas supply director. “Combine an economic slowdown with greater gas production and you have all the ingredients for a decline in prices.”

Last year Northwest Natural decreased gas rates 8% in Oregon and 10% in Washington as a result of lower wholesale prices at the time.

Under the increases being sought, residential customers would see a monthly increase of about $10 in Oregon and $15 in the state of Washington. For commercial customers, the increases would be 16% and 21% in Oregon and Washington, respectively, the utility said.

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