Arizona Corporation Commissioner Chris Mayes hopes to hold a meeting on huge increases in Payson propane bills sometime in the next month.
Mayes on Tuesday, sent a letter to SemStream, asking for answers to a series of questions focused on the impact of the doubling or tripling of winter propane bills in Payson that have confronted some homeowners with monthly bills topping $500.
"I think clearly people are going through a lot in trying to deal with these bills and I'd like to investigate what the company and the commission can do to address these high propane prices," said Mayes.
Mayes said she will ask her fellow commissioners to approve a town hall meeting on the issue in Payson, to air customer complaints and make sure the company does everything it can to help customers cope with the soaring heating bills.
SemStream Executive Vice President David Wunch said the company would welcome such a town hall as a chance to communicate with its 6,000 Payson customers.
"I would just like for people to understand the facts and understand the energy environment we're living in," said Wunch, noting that propane prices have climbed sharply nationally.
The Corporation Commission early last year approved SemStream's purchase of the Payson propane gas distribution system and two different add-ons to the base rate designed to allow the company to recover the cost of sharp rises in the cost of propane it buys. Both those "adjustors" have jumped sharply since SemStream took over the system.
Wunch said not only did the company have to push up the adjustors as fast as possible to recover its costs, but the company still has $800,000 in unrecovered extra costs that will be added to the adjustments of future bills.
Mayes said that such "adjustors" on the bill had become an unfortunate fact of life in regulating utilities, but that the commission would insist on eliminating the surcharge "the second" the company recovered its excess costs.
Propane bills have become aissue in the Payson mayor's race. Mayor Bob Edwards has accused challenger Kenny Evans of playing politics with heating bills while generally defending SemStream's need to recover its costs. Evans maintains that he started to question the increase in the "adjustors" on the bill right after the SemStream takeover in July, and that he would fight for a full explanation of the charges.
Mayes said that energy prices and propane costs have risen sharply all over the country in the past year, but that she wanted to ensure SemStream has programs in place to spread out monthly spikes in billing. She was also sharply critical of billing periods for December that stretched to 37 to 39 days in some cases and wanted to know whether SemStream has a low-income assistance program.
Wunch noted that the company does allow customers to average out their bills over a 12-month cycle, which would boost the low summer heating bills but lower the winter bill. He said the company will let people spread out their payments if they're having trouble paying the longer-billing period in December, caused by a wave of illnesses among company meter readers. Finally, he said the company would be willing to set up a low-income assistance program.
"What's really going on here is that propane costs have tripled nationally and we're all feeling the brunt of that," said Mayes. "We need to make sure the company is doing everything it can to mitigate those price increases and that's what the commission will be looking into."