Why has NW Natural requested a rate increase?
Even with falling prices, gas prices are higher than they were a year ago. They have been considerably higher than last year’s level for all of 2008. Every year, NW Natural adjusts its rates to correspond to natural gas costs. In 2007, the company lowered rates by about 8 percent in Oregon and 10 percent in Washington. This year, the company will raise its rates to cover higher gas costs. Last year, natural gas prices were lower than they had been in some time. Beginning in October 2007 they began climbing. This summer, gas prices set new records, peaking at about $13 per MMbtu in July. (This compares to about $7 the previous July). Even today, after the dramatic drop in prices, gas costs significantly more than it did a year ago. To make sure we have enough gas for our customers, we buy our gas supplies throughout the year. So all year, we have been buying some gas at higher prices than last year. Gas prices have not fallen far enough, nor for a long enough period, to make up for the
