Sep. 14—New Mexico Gas Co. has released details regarding a rate increase the state's largest gas utility will formally request from state regulators this week.
The rate hike requested by the company would result in an 11% increase for the average residential customer, increasing average monthly heating bills by an estimated $6.70, the company said in a news release.
The new rates, if approved by Public Regulation Commission, could go into effect by October 2024.
New Mexico Gas, an investor-owned utility and a subsidiary of Canada-based Emera Inc., provides natural gas to more than a half-million customers throughout the state, according to its website. In its coming request for a rate increase, which is due to the commission by Friday, the gas company will request to collect about $49 million more annually in revenue from customers than it does at current rates.
The last rate increase for New Mexico Gas was approved by regulators less than a year ago, and it took effect in January. That 4.3% average increase brought up residential bills by an average of $3 per month, according to regulatory filings, although the company had initially requested more than double the increase regulators granted.
The proposed rate hike for 2024 would cover what the company says are increasing costs related to operations and infrastructure improvements, including upgrades to an aging customer billing and account information system.
New Mexico Gas will also seek to recover expenses related to the ensuing rate case with the commission as well as costs related to "increased bad debt during the COVID-19 pandemic," the company's application to the commission states. Other expenses include studies related to an ongoing liquefied natural gas project planned for Rio Rancho as well as fees related to customers' paying with credit cards.
"We strive to keep costs as low as possible," New Mexico Gas President Ryan Shell said in the news release, "but we are experiencing inflation and increasing costs in many areas, including costs to comply with expanding regulatory requirements as well as costs for retaining and attracting a skilled workforce to serve our customers."