Atmos Has Dallas Over a Barrel, Is Raising Your Gas Bill Again

Categories: Biz, City Hall

AtmosEnergyBuilding.jpg
Atmos Energy, via Facebook
It's a wonderful time to be an Atmos Energy shareholder. The gas distributor's profits -- and dividends -- keep going up.

It's much less wonderful to be an Atmos Energy customer, who is fueling those profits through increasingly large bills.

Despite its profitability and despite getting six rate hikes out of the city in seven years, Atmos is asking Dallas residents to pay a bit more: $8.7 million total per year (a 12.3 percent increase) or about $2.75 more more per customer per month.

Negotiators hired by the city have talked the gas distributor down to a mere 9.5 percent increase, but that's as low as Atmos would go.

The company argues that it needs the extra money to replace aging pipes and infrastructure. The Texas Railroad Commission in its wisdom has determined that gas distributors should be allowed to pass along to ratepayers the cost plus a 10 percent return on investment.

The probable rate increase was a bitter pill for Dallas Councilman Philip Kingston and his colleagues on the council's Budget, Finance, and Audit Committee to swallow at this afternoon's meeting. The problem is, there's basically nothing they can do about it.

Technically, the city does have a couple of other options. It can reject Atmos' request for a rate increase and keep rates flat. Or, it can set whatever rate it deems fair. In either case, however, Dallas would have to swallow the full 12.3-percent increase temporarily while the case was on appeal to the Texas Railroad Commission, then permanently when the notoriously industry-friendly agency approves the appeal.

Councilman Tennell Atkins has seen cities try this approach, and he's seen them fail.

"I've been there, and I've seen that we've got to negotiate what is best for the city right now rather than take a chance down in Austin," Atkins said.

The committee voted to approve the negotiated 9.5-percent rate hike, which will go before the full City Council next week. Kingston was the only no vote, even though he acknowledged that, given the politics, fighting Atmos' request is futile.

"We give a lot less money to Railroad Commission candidates than Atmos and its competitors do."

Send your story tips to the author, Eric Nicholson.

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36 comments
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bvckvs
bvckvs topcommenter

It's unfortunate that they council did not have them specify what infrastructure they were planning on improving - so that we could exercise oversight over whether or not the work gets done.


TheRuddSki
TheRuddSki topcommenter

Vladmir, you magnificent bastard.

ozonelarryb
ozonelarryb

Make them put the increase in a fund for faulty fittings explosion victims.

MikeWestEast
MikeWestEast

Cut back on usage.  Lower thermostat setting in winter, raise in summer. 

LarryLemonjello
LarryLemonjello

I don't think most Dallas residents give two shits about $33 a year. Especially this time of year. They're probably wondering why the value of their property went up when no houses on their street sold. And why they have to fork over a coupla hundred dollars more next January 1st. 

lebowski300
lebowski300

Good thing fracking is increasing supply. Free markets win again!

anthonypage
anthonypage

Is there any possibility of using this issue as leverage to persuade Atmos to stop placing permanent obstructions in the middle of sidewalks?

jmckee3
jmckee3

I'm confused, as a consumer what benefit do I receive from there being a profit incentive in running a monopoly in a commodity that basically has inelastic demand? And that is even before we get to such a ludicrous demand as providing a direct return on investment on maintaining the infrastructure that allows them to provide their product with some degree of public safety. The return on investment is you get to keep selling your product and not pay out damages for blowing stuff up with it.

mavdog
mavdog topcommenter

Just don't renew their franchise. That will get their attention....

mavdog
mavdog topcommenter

@TheRuddSki

you must have missed this factoid from the article:
The company argues that it needs the extra money to replace aging pipes and infrastructure. The Texas Railroad Commission in its wisdom has determined that gas distributors should be allowed to pass along to ratepayers the cost plus a 10 percent return on investment

so unless "Vladmir" is the guy who put the pipes in the ground, not sure who you are referring to.

TheRuddSki
TheRuddSki topcommenter

@manpanties

Obama's intent to bankrupt was directed at coal use, not natural gas. But, the whole idea is to make fossil fuels exorbitantly expensive, because polar bear holocaust, So this price hike Is great news!

TheRuddSki
TheRuddSki topcommenter

@lebowski300

Fracking does nothing to repair aging infrastructure.

Tim.Covington
Tim.Covington

@jmckee3  Depending on the city code, it may not be a monopoly. From a technical perspective, all a property owner has to do is have a tank installed, and then have competitors deliver to the property. This is how it is done in rural areas. However, you then either have a big ugly propane tank in your yard, or you are paying to bury it.

wcvemail
wcvemail

@mavdog  
You'll never get elected. I just Googled for any municipal utility changes anywhere but could not find even one, meaning that status quo keeps quoing forever. The only interesting reference I encountered was a caveat about investing in utilities, not because of customer-driven market forces or loss of franchise, but because of increasing mergers and acquisitions, meaning that the status quo keeps quoing AND getting bigger. 

TheRuddSki
TheRuddSki topcommenter

@mavdog

I was referring to Vlad the Invader and his control of gas supplies in Ukraine, and...

Well, never mind.

lebowski300
lebowski300

@TheRuddSki  So when the infrastructure is not so aged, then rates go down? Hah. The tollway people sell that same lie, paying for the road (i.e., infrastructure) many times over and using the short memory of the idiot masses to rob them blind year after year. 

bifftannen
bifftannen

@Tim.Covington @jmckee3 Propane and natural gas have different energy content. I know you can convert a clothes drier and stove to propane, not sure about HVAC. Water heaters seemingly can't, you have to pick which fuel you're using at the time of purchase.

TheCredibleHulk
TheCredibleHulk topcommenter

@Tim.Covington @jmckee3  

Whenever I fill my 250 gallon tank sometime around July when the propane price hits about .85 / gal, that old girl looks beautiful to me.

TheRuddSki
TheRuddSki topcommenter

@timdickey

I have a Scientific Anglers sticker on my car's back window.

timdickey
timdickey

@TheRuddSki Spider caught a fly!

TheRuddSki
TheRuddSki topcommenter

@mavdog

"Hear me talking hillbilly boy? 'm going to get medieval on your ass.." Still a great movie.

I loved it, but it was very, very violent.

Businesses spend billions on advertising to affect behavior. Thankfully, movies that glorify violence have no like effect.

... maybe you should go ahead and make the joke, it's got to be better than the Vlad try.

But then I would expose myself to charges of racism, homophobia, and glorifying queer rape. I chose not to take that risk, because everyone thinks Vlad, controller of natural gas, is a dick - I don't think there are any Russian nationalists in this forum.

I play it safe, and I still get complaints.

mavdog
mavdog topcommenter

@TheRuddSki

"Hear me talking hillbilly boy? 'm going to get medieval on your ass.." Still a great movie.

maybe you should go ahead and make the joke, it's got to be better than the Vlad try.

TheRuddSki
TheRuddSki topcommenter

@mavdog

Well, I was going to make a Marsellus Wallace joke, but some people here get upset about the most trivial matters.

mavdog
mavdog topcommenter

@TheRuddSki

oh, well that makes a ton of sense relative to ths article about Atmos Energy...

I'm sure it sounded like a good idea when you first thought about it.

lebowski300
lebowski300

@TheRuddSki  Three bucks doesn't matter to you. So, you pay six bucks, I pay zero. I'm glad we solved this problem. 

TheRuddSki
TheRuddSki topcommenter

Three bucks a month.

Cry us a river.

screaminscott
screaminscott

@TheRuddSki  Um.. no.  But rates do stay flat for longer because new pipe needs fewer repairs.

ThePosterFormerlyKnownasPaul
ThePosterFormerlyKnownasPaul topcommenter

@bifftannen @Tim.Covington@jmckee3 

Gas furnaces can be switched between natural gas and propane.  Check with the manufacturer of your furnace.

On your water heater, also check with the manufacturer to see if the natural gas model also has a propane model.  You might be able to switch out the burner assembly.  This is because the water heater burner assembly often does not have a replaceable orifice.

The reason why there is a difference between natural gas and propane is that natural gas is about 1,000 Btu/CF and propane is about 1,400 Btu/CF.  To burn propane, the orifice is 60% of the area of the natural gas orifice.

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