Tucson

Tucson, AZ-based UniSource Energy Corp. natural gas utility UniSource Energy Services (UES) will increase its customer bills an average of 5% this winter, despite continuing wholesale gas price reductions. The expiration of a year-long credit and an increased monthly energy service charge combined to drive up the monthly bills.

Even with wholesale natural gas prices plummeting since mid-summer, UniSource Energy Corp., the parent to Tucson Electric Co. and small combination gas-electric utility operations, announced last Wednesday that its gas costs this winter will be 8-16% higher than last winter. UniSource Energy Services (UES) purchases supplies for the parent company’s combination power and gas utility operations in Arizona.

The Arizona Corporation Commission (ACC) Friday pared down a natural gas utility rate increase for a unit of Tucson-based UniSource Energy Corp., approving a $5 million increase for its UNS Gas utility, which serves 146,000 customers. The vote was 4-1.

The Arizona Corporation Commission (ACC) granted Tucson-based UniSource Energy Corp.’s UNS Gas a 3.6% rate decrease Wednesday for its customers in the northern half of the state. A 4-cent/therm credit will be available to customers beginning Oct. 1 and running through April 30 next year.

Facing softer wholesale natural gas prices this winter compared with last year, Tucson-based UniSource Energy last month dropped a surcharge for its gas utility customers in northern Arizona that are served by its UniSource Energy Services (UES) unit. UES’s per-therm gas service rate in December will be $1.12, and the utility said it expects the rate to remain the same through the winter.

The Sacramento Valley in California was touted Wednesday as an E&P hot spot by a Tucson, AZ-based Fidelis Energy Inc., which announced that its first exploration well tested at 12 MMcf/d from a 1,000-acre tract on the North Franklin Project. It taps the so-called Winters Formation, a new discovery on a ranch about 25 miles south of the state capital in Sacramento County.

Tucson Electric Power Co. (TEP) has signed a five-year wholesalecontract to supply 60 MW of electricity to Phelps Dodge EnergyServices. The contract calls for TEP to supply the power at alltimes except during the company’s peak customer energy demandperiods from July through September of each year. TEP ChairmanJames S. Pignatelli said the contract is an important one for bothcompanies. “This agreement provides a comfort factor for PhelpsDodge as it plans ahead for its energy needs,” Pignatelli said.”And for TEP, the contract provides a stable, profitable margin forfive years and a solid boost to our financial outlook in a volatileenergy market.” Pignatelli said TEP expects the agreement togenerate revenues of about $30 million annually.