N.M. Gas seeks money for price surge

Proposal would spread customer payments over 2½ years for an average increase of $5.70 a month

New Mexico Gas Co. asked state regulators this month to let it spread out over 30 months customer costs incurred in the February storm.

The Albuquerque-based natural gas company says it had to pay about 80 times the typical cost to gas suppliers during the storm because demand was so high and supply was so low.

New Mexico Gas is one of several utility companies making requests of the New Mexico Public Regulation Commission to spread out costs or take other action to cover those extraordinary prices. Zia Natural Gas Co. of New Mexico has asked state entities to look into price gouging by gas suppliers. Numerous state and federal agencies say they are doing that.

The extraordinary costs are passed on to customers, so to avoid a huge spike at once, New Mexico Gas Co. wants to spread the price from July 2021 to December 2023.

The company must receive commission approval for a “variance,” or change in the usual way of doing business. It filed an application to the commission late last week and expects to appear before the panel in the near future.

Tom Domme, general counsel for New Mexico Gas Co., said his company took out a $100 million loan in March to help cover the payouts to suppliers. Extraordinary costs for Feb. 13-18 totaled $110 million, Domme said.

“So it was a result of the storm, the disruption of supply and the increased demand,” Domme said of the price increases. By rule, he said, the company passes costs on to the customers without markup.

Ryan Shell, president of New Mexico Gas Co., said he knows it stretches customers financially.

“We understand that even with our best efforts to minimize it, this is not a small impact to our customers,” Shell said through a news release. “Our focus is to minimize the effect of the February 2021 winter event on our customers.”

New Mexico Gas’ proposal would result in an increase to typical bills of $2.37 to $8.84 per month, depending on monthly usage, the company said. The average increase would be about $5.70 per month, adding about 10 percent to the typical bill, according to the company.

The company said it already established a $1.2 million fund to assist income-qualifying residential customers and small-business owners who have fallen behind on their natural gas bills because of the coronavirus pandemic.

Domme said payment plans and assistance programs will be available to customers hit hard by the increase in gas costs, too.

“We are doing everything we can to minimize the bill impacts of these gas costs,” he said.

Customers seeking to learn more may go to nmgco.com or call 888-664-2726.