Attorney General's News Release
October 21, 2005
Nixon asks Missouri utilities to give price projections for natural gas, explain measures taken to protect consumers
Jefferson City, Mo. — Attorney General Jay Nixon is asking seven natural gas utilities in Missouri to provide projections of prices and demand for natural gas in the coming heating season and to explain the measures they are taking to protect consumers. Nixon's concerns stem from reports from the U.S. Department of Energy that natural gas customers in the Midwest can expect to pay 60 percent more for heating costs this winter.
"Missourians will be especially hard hit if natural gas prices go through the roof this winter as predicted, because 57 percent of the homes in our state are heated with natural gas," Nixon said. "We need to know what the projections are for prices and demand, and what the utilities have been doing to soften the expected blow that consumers are going to take in their pocketbooks."
Nixon and the Attorneys General of several other Midwestern states (Illinois, Iowa, Minnesota and Wisconsin) sent letters to the investor-owned local distribution companies in their states. The letters ask the utilities to provide information regarding:
- Projections of natural gas prices and natural gas demand for the 2005-2006 heating season and historical data for the past three heating seasons.
- Causes of any price increase for the 2005-2006 heating season.
- All measures the companies are taking to lessen the impact of the expected higher prices on consumers statewide, including fixed rate plans, subsidies, bill amnesties, budget payment plans and consumer education efforts.
- Internal efforts at energy efficiency, conservation, hedging (which would allow companies to lock in prices when rates are lower) and other steps the companies are undertaking to control upward price volatility for consumers.
"Dramatically higher utility rates this winter could have a devastating impact not only on homeowners, but also those who have to pay the heating bills for schools, businesses, churches and other buildings," Nixon said. "As Missouri's consumer advocate, I want to find out now what is being done and what can be done to help energy consumers."
Nixon said he and his fellow Attorneys General will use the information in their review of natural gas pricing and supply issues to develop best-practice approaches to protecting energy consumers. Those approaches could include changes in how Missouri regulates utilities, programs to protect low-income and other at-risk groups, consumer education, and litigation.
Nixon's letter was sent to the presidents of Aquila Inc., which does business as Aquila Networks MPS and Aquila Networks SJLP; Atmos Energy, which does business as United Cities Gas and Associated Natural Gas; Fidelity Natural Gas; Laclede Gas Co.; Southern Missouri Gas; Southern Union Co., which does business as Missouri Gas Energy; and Union Electric Co., which does business as Ameren UE.
Earlier this week, Nixon sent a letter to Congressional leaders asking them to increase funding for the Low Income Home Energy Assistance Program (LIHEAP). LIHEAP, a federally funded program that assists low-income households in meeting their energy bills, operates in all 50 states and U.S. territories. The program offers bill payment assistance, energy crisis assistance, and assistance in weatherization and energy-related home repairs.
On Sept. 28, a bi-partisan group of governors from 27 states sent a similar letter to Congress and President George W. Bush requesting $1.276 billion in emergency LIHEAP funds. Missouri was not among the states that joined in the request.
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Inquiries from consumers should be directed to consumer@ago.mo.gov or 1-800-392-8222 (from within Missouri) or 573-751-3321 (outside Missouri).
All media inquiries should be directed to the Press Secretary.
E-mail Phone: 573-751-8844 Fax: 573-751-5818