Citizens' customers wracked by high gas bills

Citizens Arizona Gas customers have turned shock at high December bills into a flood of phone calls to Citizens, the Arizona Corporation Commission and local papers.

The double whammy of a cold December and temporary rate hikes to pay for last winter's historically high natural gas prices were "budget busters" for area customers.

"In December 2000 and January through February 2001 Citizens paid the highest wholesale prices in 50 years," Tom Broderick, Director of Business Development for Citizen's Arizona Gas, said.

"They were the highest prices we have seen in Northern Arizona."

Those price spikes caused Citizens to pay $38 million more for gas than retail customers were charged.

After approval by the ACC in summer 2001, a surcharge of 40 percent was added beginning in October to recover the Citizens' costs.

"Customers just experienced the effect of the increase with the recent bill," he said.

"Warm weather kept most furnaces off until Thanksgiving."

Flagstaff gas customers had the highest usage this December.

Broderick said customers typically turn on heat when temperatures drop below 55 degrees.

That happened in late November and continued through December.

"December was colder than normal and people used more gas," he said.

"Last December was warmer and customers used more gas this year."

The additional usage added to the extra charge per therm (the unit of measure for natural gas) used pushed bills beyond customer expectations.

Citizens Kingman Manager Scott McKnight said the only bright side for customers from the higher bills is that the lower bills will return sooner.

The extra charges are accounted separately and reported to the ACC.

When the $38 million is collected, the temporary charge is dropped.

Current wholesale gas prices being paid by Citizens are below average costs.

The savings the company makes by buying for less this year will help pay the $38 million.

Broderick said there is no difference, in theory, between the pass-through of wholesale gas costs and electric costs for electric distribution companies like Citizens.

"The fact that all natural gas distributors in Arizona buy gas and are pass-through distributors, like Citizens, speeds the process before the ACC," he said.

Customers all over the country paid the higher gas costs, but in Arizona the costs are delayed until the ACC approves the change.

Homeowners in most other states paid for the price spike last winter, Broderick said.

Citizens is working with customers to ease the pain.

Conservation, winterization of the home and budget billing are the primary ways costs can be controlled.

Citizens offices and the Web ( have information available to help customers reduce gas use.