Gas companies warn bills will be $100-plus higher

By KEN KUSMER, Associated Press Writer

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By Beth Boehne

INDIANAPOLIS (AP) — The news keeps getting worse for Indiana consumers reeling from higher food and gasoline costs: They also can expect to pay at least $100 more this winter to heat their homes, say two of the state's three major natural gas utilities.

Vectren North, formerly known as Indiana Gas, projects its 568,000 customers will pay a total average heating bill for November through March of between $780 and $850, compared with $680 last season.

Citizens Gas is telling its 266,000 Indianapolis-area customers to expect to pay $939 for its average use over the same five months, or $158 more than the $781 they would have spent last season.

The state's largest natural gas provider, Northern Indiana Public Service Co., also warns customers to expect higher bills this season, but it hasn't released specifics yet. State regulators expect to hear more detailed projections at a forum Oct. 30.

"It's going to be a difficult year — a challenging year," Mark Young, chief operating officer of the Indiana Housing & Community Development Authority, said Thursday.

Health and Human Services Secretary Mike Leavitt softened the blow of the forecasts, announcing Wednesday that Indiana would receive an additional $2.5 million in emergency funding from the Low Income Home Energy Assistance Program. That brought the state's total LIHEAP funding to $67.6 million for the current federal fiscal year, which ends Sept. 30.

It's not clear yet how much Indiana will receive from LIHEAP in the next fiscal year, said Young, whose agency administers the program in Indiana.

What is clear, though, is that all consumers — not just those who qualify for government assistance programs — should start preparing now for higher bills this winter, advocates and utility representatives said Thursday.

"What we considered to be a low-income issue has essentially become a middle-income issue," said Grant Smith, executive director of the Citizens Action Coalition, a grass roots consumer group active on utility issues.

Indiana law bars investor-owned utilities from making a profit on natural gas costs, but that hasn't stopped those costs from soaring in recent years. Fuel costs were flat last year, but they went up 5 percent to 20 percent each of the previous four years, said Vectren's Chase Kelley.

Natural gas averaged $2.50 per 1,000 cubic feet through the 1990s, then began rising as power companies increasingly turned to natural gas as a fuel source, Kelley said. Prices soared to $14.00 after Katrina, and it's currently about $8.

"Prices have tripled, quadrupled, even more than that since the turn of the century," Kelley said.

Dave Menzer, chairman of the Coalition to Keep Indiana Warm, an association of governments, nonprofits and utilities, said heating aid hasn't keep up with inflation. The group supports a move in Congress to add $3 billion more to the heating aid program, he said.

The potential for prices to spike again from the disruptions caused by Hurricane Ike prompted Vectren and Citizens to brace customers now for higher prices.

"The weather's nice. Get out and make those home improvements," Kelley said.

Utilities and the Indiana Office of Utility Consumer Counselor said consumers can act now to reduce high heating costs:

— Reduce energy use by caulking around windows and doors, adding insulation, and switching to higher-efficiency appliances, which can earn customers rebates from some utilities.

— Use budget billing, which eliminates the shock of wintertime heating bills by spreading the costs over 12 months and allows consumers to budget and plan with more certainty.

— Apply for government aid from LIHEAP, known in Indiana as the Energy Assistance Program. Applications generally are available through Community Action Agencies. Eligible are households earning no more than 1½ times the federal poverty level.

— Keep open lines of communication with utilities and contact them as soon as possible about problems paying a bill.

"The sooner you contact the utility, the more likely they will be able to work with you," said Anthony Swinger, a spokesman for the consumer counselor's office.

___

On the Net:

Indiana Community Action Association: www.incap.org

Office of Utility Consumer Counselor: www.in.gov/oucc/

Indiana Housing & Community Development Authority: www.in.gov/ihcda/

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