Copyright 2000 The Houston Chronicle Publishing Company
The Houston Chronicle
October 05, 2000, Thursday 3 STAR EDITION
SECTION: BUSINESS; Pg. 1
LENGTH: 523 words
HEADLINE:
Rate hike clarified by HL&P;
Bills for winter to rise 11.4 percent or
more
SOURCE: Staff
BYLINE:
MICHAEL DAVIS
BODY:
Reliant Energy HL&P
customers are likely to see their average residential bills rise by 11.4 percent
or more this winter, depending on their power use, the company said Wednesday.
That exceeds the estimated 10.5 percent impact the company announced
Tuesday after it filed its request for another increase in electric costs to
reflect rising natural gas prices. The 10.5
percent estimate is based on the average use of all customers over the course of
an entire year. The actual increase experienced will vary by customer and by
month depending on usage and time of year. And the adjustment may be changed
during a review by the Public Utility Commission of Texas.
Even if the
cost of natural gas goes down next spring, that may not mean relief for
consumers because a seasonal decrease in natural gas prices next spring is
already built into the latest fuel adjustment request, said Paul Gastineau,
director of regulatory affairs for HL&P.
For that reason the
increase is likely to remain in place after April, when HL&P's fuel rate
will again be reviewed by state regulators.
This is the second large
fuel price adjustment in recent months. HL&P bills will have increased by
22.65 percent since early July if a requested fuel adjustment goes into effect
in December. The company received a fuel rate adjustment increase in August that
resulted in increase of 11 percent to the average residential bill.
The
company said the typical residential bill will see an increase of 10.2 percent
in the summer, while a typical winter bill will increase of 11.4 percent.
The different percentages reflect the seasonal ups and downs of electric
rates. An HL&P bill consists of the base rate and the fuel rate.
If
the fuel increase request is approved by the PUC, it will amount to 3.9 cents
for the cost of each kilowatt-hour of power purchased by a consumer.
However the base rate of a kilowatt-hour of power varies markedly in the
winter and the summer. Summer base rates are higher because it costs more to
provide enough power when demand peaks. During that time of year the company has
to cover the added cost of peaking plants, which provide the extra power needed
during the air conditioning season, Gastineau said.
The rates go down
during the winter when demand is lower.
As as result of the higher base
rate, the percentage impact of the fuel price adjustment amounts to a smaller
percentage increase during the summer months, which lowers the annual average.
Other factors also affect these percentages.
For example the $
6.33 facilities charge and other fixed charges figure more into the monthly
percentage increase on a smaller bill than a large user.
Also during the
winter, the heaviest users get a break on the cost of power. Because winter
usage of more than 800 kilowatt-hours is billed at a lower base rate, those in
that group will see a higher percentage increase with the fuel price adjustment
than those with lower demand.
The company arrived at the 10.5 percent
average figure using a customer who used 15,000 kilowatt-hours per year and who
would see an annual bill of $ 1,584.14 rise by $ 150.04.
LOAD-DATE: November 20, 2000
