Aspen loses appeal in natural gas dispute |

Aspen loses appeal in natural gas dispute

M. John FayheeSpecial to The Aspen Times

Aspen’s legal effort to get more bang for the buck in consumers’ heating bills lost a key battle Thursday.The Colorado Court of Appeals sided with energy company Kinder Morgan in a case the city of Aspen started in 2004.City Attorney John Worcester filed the lawsuit after the city received a complaint that Kinder Morgan was selling natural gas in Aspen for the same price it was selling natural gas in lower-elevation towns.Normally, if anything in Aspen is priced the same as it is anywhere else, it’s cause for consumer glee. But in the case of natural gas, the price may be the same, but the whiskey is watered down, so to speak, Worcester said.”The issue that resonated with me was that Kinder Morgan sells natural gas throughout western Colorado and charges the same, no matter where that gas is delivered,” Worcester said Thursday, after learning Aspen had lost its case. “Natural gas delivers a certain number of BTUs of energy per volume, but, when you bring it to altitude, the volume increases, but the heating capacity does not increase. So, you get less heat per volume. They sell less hydrogen molecules per volume to the people of Aspen.”So Aspen filed a lawsuit in the 9th District Court.Kinder Morgan argued that the case, was “without merit and baseless.”Kinder Morgan officials said in an interview shortly after the filing of the case that gas bills are adjusted to compensate for the lower heating value per volume, but those adjustments are not necessarily outlined in customers’ bills.”We’re always trying to balance the information [consumers] need [with] keeping the bill simple,” Dan Watson, Kinder Morgan’s retail president, said in June 2004.Watson added that the lower atmospheric pressure that comes from higher altitude is factored in at the company’s border stations – points where natural gas flows from main transmission lines into the cities Kinder Morgan services.District Judge T. Peter Craven sided with Kinder Morgan and threw out the case in September 2004.But, rather than clearing up the question about whether Kinder Morgan was overcharging its Aspen customers, Craven’s ruling stated the Colorado Public Utilities Commission should have heard the case instead of the courts.Worcester disagreed and appealed the case to the Colorado Court of Appeals.On Thursday the appeals court sided with Craven’s ruling.”Once again, they never ruled on the merits of the case,” Worcester said. “They simply stated that the case should be heard by the PUC.”Watson on Thursday said he was pleased with the results”As I read this decision, it’s a complete victory for us. We got exactly what we asked for. The court said the city of Aspen was trying to do an end run around what the PUC is authorized by statute to do: to regulate rate making.”Worcester said he did not yet know whether the city would appeal the ruling to the Colorado Supreme Court or take the case before the Public Utilities Commission.”I don’t believe we would get a very sympathetic hearing from the PUC,” he said. “I’ll have to talk with the City Council to get further direction. The point stands, though, and Kinder Morgan acknowledges this, that there’s a 5 to 9 percent difference in the heat value of the gas they sell to the people of Aspen.”Watson said, “We won both trials. The decision was well-written. It would be unfortunate if Aspen decided to appeal. It is an expensive process. The court has stated that the PUC is where rate issues are properly decided.”

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