TN: Heating bills shock customers

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Heating bills shock customers: Deregulation shows cold side of market

Clint Confehr / Senior Staff Writer January 21, 2001 Cold, wet snow this weekend emphasizes high heating bills which are stunning natural gas customers this month. Peggy MacPherson of Lewisburg Avenue had a natural gas bill this month that "was a little over $800 and the highest it had been was in the $400 range," she said last week.

"It's ridiculous. The $800 just stunned me," MacPherson said. "It won't be that high next month. We're wearing sweaters."

Her solution is one of the suggestions from the Tennessee Regulatory Authority's Nov. 30 tips on home heating costs which followed an Oct. 6 warning from the TRA predicting gas heating costs would increase 30-40 percent because lower gas inventories with increased demand would drive up the price of the commodity.

Government deregulation of natural gas several years ago came when demand was less and gas explorers, producers and wholesalers weren't earning much money, "so they got out of the business," TRA Energy Chief Mike Horne said. "That reduced the supply ... but demand has continued to grow."

That's cold comfort for Pat McCulloch of Morningside Drive. Her gas bill went from $217 in December to $243 this month, but that's to heat a three-room apartment she rents for $310 a month.

"I'm working seven days a week so I can make ends meet," McCulloch said. "I'm not destitute ... and there are so many who are in far worse shape than myself."

Graceworks Ministries Executive Director Cheryl King says she's seen gas bills as high as "a little over $500 ... We are seeing an increase in the request for assistance. It is because of the natural gas prices."

Assistance to qualified Williamson County residents can be up to $200 per household paid to the utility, King said. Applicants must go to Graceworks at 104 Southeast Parkway. It's open Monday-Friday from 9 a.m.-4 p.m.

"Typically, it's an emergency situation where they had to put tires on a car or make a choice between medicine or a utility bill," she said.

Zac Potts, a salesman at Sewell's appliance store on Columbia Avenue where United Cities Gas bills may be paid, says, "There have been some $800 and $900 bills for residential service."

UCG says its Internet Web site at www.unitedcitiesgas.com offers conservation tips, information about the impact of higher gas costs, and lists energy assistance agencies and authorized payment center locations. A few years ago, UCG was bought by Atmos Energy Corp., which closed customer service centers and established a toll-free phone line to Amarillo, Texas, at (888) 824-3434. It's staffed 24 hours a day, seven days a week.

On Wednesday, UCG announced, "Employees in the company's local office in Franklin at 122 Second Ave. N. will be temporarily reassigned and be available to answer questions and provide customer assistance."

This month, calls quadrupled from Atmos' 300,000 customer base in Tennessee, Virginia, Georgia, Illinois, Iowa and Missouri.

McCulloch and MacPherson called the toll-free number.

"I'm put on hold so I can talk to a person," McCulloch said of the automated system. "Then, I talk to a person and naturally it's the wrong one and they put me on hold again."

She never did speak with the right person because she had to work, but MacPherson did reach someone who tried to help.

"Last month, I got a termination notice, but we had paid the bill," MacPherson said. "When I finally got them on the phone, they said my bill was $360-something. I assumed that was the old bill."

It wasn't. It was for the bill that grew to more than $800, she explained.

Roger Wright, executive director of the Mid-Cumberland Community Action Agency, oversees service in seven Middle Tennessee counties and has an office at 129 W. Fowlkes St., Suite 136, where applications are accepted for assistance.

State oversight imposes "some limitations on the amount we can help," Wright said. "Most of the checks I've seen have been in the range of $150-$200."

That's in conjunction with a limit on assistance. Help requires processing by the Department of Human Services and that can take a month, so applications this week may result in payment to a utility several days before March.

Wright says he's anticipating additional dollars which will boost his budget for home energy assistance to more than $1 million. It could mean help for people who've already received the maximum.

Help is funded through a federal Community Services Block Grant and the Low Income Home Energy Assistance Program. LIHEAP funding was increased $300 million nationally last month by order of then President Clinton.

The U.S. Energy Information Administration says an average residential natural gas user will pay 70 percent more for heat this winter.

That's hurt business for Sewell's, where Potts' customers "say they won't go with another gas appliance and that they'd rather have an electric heat pump."

Natural gas is also used to generate electricity, and Middle Tennessee Electric Membership Corp. says the "colossal failure" of electric industry deregulation in California "could prove to be a monumental blessing for Middle Tennessee."

California Gov. Gray Davis declared a state of emergency Wednesday. The next day saw a second day of rolling power outages of about two hours each, according to The Associated Press. The crisis is blamed partly on the Northwest's limited supplies of hydroelectric power and California's deregulation of its electric industry.

"The doors to open competition in the electric utility industry have been bolted shut temporarily," said Jim Baker, president of Middle Tennessee Electric Membership Corp., the electric utility for most of Williamson County.

"If there's anything to be learned from California's power crisis, it's that state and federal legislators need to be very cautious, especially in areas where electric rates are low and power supplies are adequate - like Tennessee," Baker said.

It's a point not lost on McCulloch, who notes that MTEMC is organized as a cooperative utility, meaning its customers elect the utility's board of directors.

Meanwhile, as UCG again offers customer service at its offices, UCG President Tom Blose says, "The cost of natural gas is not a source of income for the company. Changes in natural gas costs - either up or down - are passed through to the customers on their monthly gas bill."

UCG charges for "safe and reliable delivery" of the fuel and the cost of providing the service, the utility said. Nationally, natural gas costs have doubled since last winter.

In addition to expanded service options, UCG "partners" with local energy assistance agencies to provide funds for customers needing help with their gas bills and those agencies benefit from UCG contributions to help deal with more requests for assistance, the company said.

UCG also allows a payment plan to spread out the cost of paying gas bills. That way, a social service agency's delayed response can keep the heat coming.

http://www.zwire.com/site/news.cfm?newsid=1305594&BRD=950&PAG=461&dept_id=162488&rfi=6



-- Martin Thompson (mthom1927@aol.com), January 21, 2001


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