Questar Gas Files Utah Pass-Through Rate Decrease

SALT LAKE CITY — Questar Gas today asked the Utah Public Service Commission (PSC) to approve a $66.9 million, or 11.2 percent, decrease in its Utah natural gas rates. This change is requested to go into effect Jan. 1, 2002.

This is the third rate decrease Questar Gas has requested this year for its Utah customers. This decrease is the result of lower purchased-gas prices. Questar purchases about half of the gas it provides customers from outside suppliers. The rest comes from Questar Gas-owned wells and is delivered to customers at Acost-of-service@ pricing. The company-owned supplies are considerably less expensive and more stable than gas purchased from outside suppliers.

"We are pleased to pass on lower gas costs to our customers," said Questar Gas President and CEO Nick Rose. "However, fluctuating gas prices — either high or low — do not provide the kind of cost stability customers need to budget properly. To help, we have begun using some financial tools including different types of contracts to reduce the impact of peaks and valleys in the natural gas market. But more needs to be done to stabilize supply and demand. That's one of the reasons Questar Gas and the American Gas Association are supportive of a national energy policy that will provide more price stability to customers."

Such a policy was passed by the U.S. House of Representatives in August and is now waiting action by the Senate.

If this request is approved by the PSC, it will decrease the annual bill for the typical residential customer using 115 decatherms per year from $767.02 to $681.02. This is a decrease of $86 per year.

The decrease request is part of Questar Gas's "pass-through" filing. Such filings enable the company to reduce rates immediately to reflect changes in gas-supply and gas-processing costs. This also includes a request for the PSC to allow recovery of $5.8 million of CO2 processing costs. A recent Utah Supreme Court decision determined that certain gas-processing costs may be included in a pass-through filing.