Finally, the great recession has yielded some good news for beleaguered Rim Country residents girding for their winter heating bills.
Granted, it’s kind of weird, mixed message good news — but we’ll take what we can get in these strange times.
Specifically, the Arizona Corporation Commission this week ordered SemStream to refund some $652,000 in overcharges run up in the past year as propane prices dropped below the regulated price due to the global slump
As a result, people hooked up to SemStream’s underground system should see a roughly 20 percent drop in their bill starting in November. The refunds will continue every month until the company pays back the $652,000 in overcharges — which will probably take eight to 12 months.
That refund comes on top of a big drop in propane prices in the past year, due to a global plunge in the price of oil. Reduced demand due to the global recession played a key role in that reduction after delirious speculators drove global oil prices to absurd levels during the go-go days of the great housing bubble.
As usual, the bewilderments of oil markets and state-regulated utilities leave addled consumers half indignant, half befuddled.
Last winter people faced a doubling and tripling of their propane bills, with two different surcharges. Those surcharges were intended to help the company cope when propane prices soared while the regulated price remained stubbornly fixed.
So residents fumed and blinked and sighed and resentfully paid up as the surcharges exceeded the base price, muttering darkly about getting ripped off by the great corporations gaming the system.
So then the oil bubble burst, the recession took hold and oil prices plunged.
Somewhere in there, SemStream’s parent company went bankrupt after making some bad bets in the oil futures market that had turned into a floating craps table.
Mercifully, prices have now retreated. In fact, they fell so fast that SemStream begin to over-collect early this year. The company should have notified the Corporation Commission and started providing refunds back in May, but through an acknowledged oversight, didn’t fess up until August. By that time, the over-collection had risen to $652,000.
Now, we’re actually inclined to believe that SemStream made an honest mistake on that front — although we were gratified that the commission insisted on a faster repayment than the company initially proposed. We also hope the company will benefit from the lecture on timely notification the commission delivered — and the commission will remember its own words should the situation recur.
But in the meantime, it probably worked out all right that the 20 percent refund won’t start showing up until November.
That’s about when homeowners will get hit with much higher winter heating bills. So the 20 percent refund on top of the drop in propane prices should ease the burden on hard-pressed ratepayers this winter.
And that’s why we’re hoping many homeowners will consider donating at least a portion of the $30 in average monthly savings to SemStream’s Share the Warmth program.
This check off on your monthly bill helps fund a program that helps people in this community struggling to pay their heating bill because they’ve stumbled into hard times — as a result of illness, disaster or unemployment.
SemStream works with the Arizona Community Action program that uses federal grants to help people in need keep their heat turned on through the winter.
Let’s help our neighbors and invest in our community.
After all, that’s one thing we’ve learned in the last year. Bankers, mortgage brokers, oil speculators and oil companies will happily overlook us if we don’t look out for each other.