As part of our continuing investment in Arizona, we filed a base rate adjustment request, the first in five years, with the Arizona Corporation Commission. Since the last base rate adjustment in 2010, we have invested more than $783 million to improve our distribution system in Arizona. The proposed new rates will reflect the capital investments made since then, and will also reflect updated authorized revenues related to changes in the level of operating expenses. This base rate adjustment will allow us to continue to invest in the safety and reliability of the natural gas distribution system to serve the energy needs of our customers.
- On April 5 the Arizona Corporation Commission approved a base revenue increase of $16 million for Southwest Gas. These new rates follow a five-year rate moratorium.
- The decision adopts the Settlement Agreement which was entered into by a diverse group of parties, including: Commission Staff, the Residential Utility Consumer Office, Arizona Community Action Association, Property Owners and Residents Association of Sun City West, Desert Valley Natural Gas and the Arizona Investment Council.
- Under the decision, average residential customer bills will experience an increase of 1.09% annually, or approximately $0.40 a month.
- No change to your basic service charge.
- No change to the components of your bill.
- Base rates will see a nominal 2.8% increase. For the average residential customer bill, this translates to $1.14 per month or less than 4 cents a day.
The inflation rate has been 7.9% since the last base rate adjustment in 2010. In contrast, our proposed rate increase will only be 2.8%. This is because we diligently work on containing costs through efficiently managing our operations without any compromise in our service to you. Since 2010, our cost savings initiatives have saved customers approximately $26 million.
We’re committed to investing in efforts that will improve the safety and reliability of our gas infrastructure in Arizona. Our continued investment will benefit you and our community in many ways:
FREQUENTLY ASKED QUESTIONS
How will this proposal affect my bill?
Under our proposal, the average residential customer will experience a nominal increase of 2.8% over existing rates, or $1.14 a month, which is less than $0.04 per day.
When will I see this change on my bill?
At this time, the new rates are expected to be in place by May 2017. This proposal will be thoroughly examined by the Arizona Corporation Commission Staff, Commissioners, the Residential Utility Consumer Office and others prior to approval, which takes time.
Why does Southwest Gas need to increase my rates?
There are two primary reasons: to reflect the significant capital investments made in the natural gas distribution system since the last base rate adjustment; and to update authorized revenues so that they reflect changes in the level of operating expenses.
When was the last time Southwest Gas requested a base rate adjustment in Arizona?
It was in November 2010, more than five years ago.
What has Southwest Gas done to attempt to keep its costs down?
We diligently work on containing costs through efficiently managing our operations without any compromise in our service to you. Since 2010, our cost savings initiatives have saved customers approximately $26 million. These cost containment efforts are further demonstrated by the favorable comparison between the proposed rate increase of 2.8%, versus the inflation rate of 7.9% since the last base rate adjustment.
