Despite proposing an increase in May 2005 natural gas commodity prices, Xcel Energy said Friday that gas bill amounts will drop due to a decrease in use of the commodity. According to the company, projected bills would drop next month by 33% for typical residential customers and by 29% for typical small-business customers.

Under the price increase proposed to the Colorado Public Utilities Commission for residential and small-business customers, the natural gas commodity price would increase by 9% in May to $0.6409 per therm, up from $0.5887 per therm in April 2005.

Typical residential customers are expected to reduce consumption by 43% in May, which means their overall bill would drop to $36.15 based on consumption of 34.4 therms. This compares to $53.72 this month on use of 60.2 therms. Typical small-business customers are expected to use 36% less natural gas in May. Typical bills would be $162.66, based on consumption of 184.9 therms, compared to bills this month of $230.19 on use of 288.6 therms.

If approved, the new prices would take effect May 1. As a comparison, typical residential bills for May 2004 were $31.34, or about $4.81 lower than projected for next month, based on the same consumption of 34.4 therms. Typical small-business customer bills were $136.88 in May of 2004, or $25.78 lower than projected for next month, also based on the same use of 184.9 therms.

“The higher commodity prices projected for May have been attributed to a continued tight balance between natural gas supply and demand, concerns over summer natural gas requirements and crude oil prices near $54 per barrel,” Xcel Energy said.

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