In Arkansas, Cost of Natural Gas Rises to Match U.S. Median Prices

Black Hills Energy, Arkansas Oklahoma Gas, and CenterPoint Energy told the state’s Public Service Commission (PSC) on October 31 that natural gas rate changes  (Docket Nos. 07-045-U, 07-046-U, and 09-107-U, respectively) would take effect the next day and would end March 31, according to a report in the Arkansas Democrat-Gazette.

The commission is not required to hold hearings to approve the rate changes.

Black Hills’ natural gas rates will go up 9.18 percent, while CenterPoint’s rates will increase nearly double that amount – to 19 percent. Splitting the difference, rates for Arkansas Oklahoma Gas will go up by 13 percent.

CenterPoint is the largest natural gas utility in the state, however only 8 percentage points of its requested rate increase is attributable to natural gas price changes, spokesperson Alicia Dixon told the local news outlet. The other 11 percentage points are from the change in the utility’s base rate, as well as other charges.

“It’s just the national landscape of natural gas prices being higher than they were last year,” said that utility’s President Kim Linam, adding, “because our rates are based on the indexes that are published nationally.”

According to energy economist James Williams, the newspaper said, the cost of natural gas has increased by about 20 percent since October of last year. Even with the increase, natural gas prices are considered to still be significantly lower than in the past.

“It’s safe to say that while [natural gas] prices are higher than they were last year, they are still lower than they were several years ago,” said the PSC General Staff Executive Director  John Bethel.

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