NIPSCO: Gas bills may rise 60% Source: South Bend Tribune Publication date: 2000-08-31 Arrival time: 2000-09-15

Northern Indiana gas customers should plan for 50 to 60 percent higher bills than last winter, according to executives from Northern Indiana Public Service Co. A 60 percent increase would mean a customer who paid $100 for home heat last December would pay $160 this December; a $150 gas bill last year would become $240 this year.

NIPSCO supplies natural gas to much of northern Indiana. The utility testified with other natural gas utilities Wednesday at the Indiana Utility Regulatory Commission's hearings in Indianapolis on natural gas prices. Ingrid Simmons, energy assistance program coordinator for REAL Services, said the price hikes would be devastating for many of her organization's clients, who include senior citizens and low-income people.

"They already live on a limited budget the way it is," she said. "I expect that we'll have more people turn to us for assistance with their utility bills."

REAL Services provided assistance for 6,000 households in five northern Indiana counties last winter. Simmons said the agency provides one-time payments of $150 to $250 during the winter to help people pay their utility bills. She expects the price hikes will stretch her budget.

"We help until we run out of funds, and then we have to refer people to other agencies," she said, adding that in recent years the program hasn't run out of money.

She said REAL Services has a weatherization program that can help minimize the impact of higher gas prices on low-income people.

NIPSCO officials said the actual bills residents face depend on the weather. Warm temperatures last winter kept bills relatively low because less fuel was used.

"While early winter weather and other factors can still affect the actual gas prices we see this winter, we are informing customers to plan on increases of 50 to 60 percent in their natural gas bills in December 2000, and January and February 2001, when compared to the same months last heating season," said Jeffrey Yundt, executive vice president for NiSource, NIPSCO's corporate parent.

"This comparison assumes normal winter temperatures this heating season vs. last season's milder than normal winter."

Michigan customers of SEMCO Energy Inc. will not see a price increase because of a freeze enacted by Michigan regulators.

NIPSCO is not profiting from the high prices because the company merely recovers through its rates what it pays for gas it purchases on wholesale markets. Gas prices are high across the country, except where freezes have been enacted or customers have arranged long-term contracts with alternate suppliers.

Yundt blamed market forces for the problem.

"A combination of decreased production during 1997 and 1998 due to unusually low gas prices coupled with increasing demand by business and industry due to the strong economy has created a supply imbalance in the market," Yundt stated. "While new production in response to higher gas prices has taken place, it can take six to 18 months for these new supplies to reach the market and have an impact on prices."

Yundt emphasized that the supply imbalance is temporary and does not represent long-term supply and demand problems with natural gas. And NIPSCO doesn't expect to run out of natural gas.

"NIPSCO anticipates no problems in meeting the natural gas needs of our customers this winter," said Yundt.

The company is launching a public relations campaign, including newsletters, information in its newsletter, and a section to be put on its Web site in September.

Yundt said the utility is encouraging customers to take time now to improve the energy efficiency of their homes and check their gas appliances to be sure they are operating efficiently and safely. In addition, the company encourages customers to sign up for a "budget plan" which equalizes gas payments throughout the year.

Staff writer Jason W. Gingerich

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-- Martin Thompson (mthom1927@aol.com), September 16, 2000