Vicksburg gas bills falling|[04/05/07]

Published 12:00 am Thursday, April 5, 2007

Surcharges placed on natural gas bills for customers of the City of Vicksburg system, which have skyrocketed throughout winter months, will now go away.

Under rates adopted by the mayor and aldermen Wednesday, customers will now pay $1.76 per thousand cubic feet opposed to the $5.54 they have been billed, said Strategic Planner Paul Rogers, who buys natural gas for the city to resell through about 10,000 meters.

The surcharges, called a purchased gas adjustment, were put in place more than a year ago to spread out customer payments and to help pay a debt on more expensive gas the city purchased, including in the aftermath of Hurricane Katrina in August 2005.

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For months, each cost increase was paid by the city-owned utility, then amortized over 12 months to customers as a fuel price adjustment, reflecting the city’s cost.

The city has paid off its $4 million debt it incurred from purchasing gas last fall. In April of last year, officials deposited $2.5 million into the gas fund to cover shortfalls in actual bills from suppliers. Customer payments between October 2005 and October 2006 were to go toward the purchase of more gas and to repay the city for what it already spent. The adjustment has made some residential winter bills soar to as high as $600 to $800.

The base price for gas is $12.10 per thousand cubic feet, a figure that has increased gradually three times in the past year and a half. Base prices are set by the Mayor and Board of Aldermen and don’t change unless a vote is passed. On the other hand, gas adjustments fluctuate monthly and, since May 2006, have gone from $16 to $5.58 and have dropped as low as $1.36.