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Gas companies under pressure

Naomi Havlen

The cities of Aspen and Glenwood Springs filed a class action lawsuit against several natural-gas companies Thursday, claiming the gas providers have bilked their customers out of money for years.Although a lesson in physics might be in order to fully understand the lawsuit, it basically claims that customers are paying for natural gas that doesn’t heat homes at high altitude as well as it does at sea level. In fact, a particular volume of natural gas might be 23 percent less effective in Aspen than at lower elevations, the complainants argue.The premise of the suit is a law of physics discovered more than 300 years ago, known as Boyle’s Law. It states that gases expand as atmospheric pressure decreases, and there is lower atmospheric pressure at higher altitude.This affects natural gas because, as the lawsuit explains, a cubic foot of natural gas at sea level has more heating content value (or British Thermal Units, BTUs) than a cubic foot of that same natural gas at higher elevations – such as the communities on Colorado’s Western Slope.The cities state in the lawsuit that the natural-gas companies – Kinder Morgan Inc., Rocky Mountain Natural Gas, and Rocky Mountain Natural Gas Company – delivered and charged for its gas based on volume, knowing that the delivered gas actually has a lower heating content at higher altitudes. And since it takes a larger amount of natural gas to heat a house at a higher elevation, natural-gas customers along Colorado’s Western Slope have been paying too much for gas for years.Aspen City Attorney John Worcester explained on Thursday that it’s easy to witness the expansion of gas in the Roaring Fork Valley. Think about the seemingly over-inflated bags of potato chips you buy at the store, or the way plastic cups of yogurt burp out a bit of their content when their foil tops are peeled back. Since gas expands as altitude increases, when a bag of chips or a cup of yogurt is packaged at sea level, the gas within them expands as they’re brought up to Aspen.Since natural gas is delivered in this area on the basis of volume, a certain amount of gas purchased at sea level takes up more space in Aspen. The gas molecules are farther apart at high altitude, and you’d have to buy more natural gas in Aspen to get the equivalent heat content you’d get at sea level. The lawsuit indicates that since no exceptions are made for customers at altitude, the gas companies are violating the Colorado Consumer Protection Act. XXXThe lawsuit further claims that other states – including Utah and Wyoming – recognize the inaccuracies of charging for gas on a strictly volumetric basis, and instead require natural-gas utilities to charge customers based on thermal content. Elsewhere in Colorado, Excel’s natural-gas customers are billed on a thermal content basis because of a 1995 mandate by the Colorado Public Utilities Commission – the very commission with which Aspen and Glenwood Springs are now making their case.”Since we’re at a high altitude, we feel we were always getting cheated,” Worcester said. “It’s disconcerting that the [Public Utilities Commission] of Colorado has known about it for a series of years and has chosen to ignore it.”A substantial jump in the price of natural gas is partly what made the city of Aspen interested in pursuing this issue. Worcester said that in 2002 the city, a Kinder Morgan customer, bought $96,000 worth of natural gas. By 2003, the price of that same amount of gas had jumped to $153,000.”For me, it’s a concern as we try to create an affordable housing program,” said Aspen Councilwoman Rachel Richards. “Cumulative bills determine if a house is affordable or not. The lifecycle of heating costs affects that.”The lawsuit filed is a class action suit, meaning that it’s filed on behalf of all customers of the gas companies on the Western Slope – cities that in addition to Aspen and Glenwood Springs include Basalt, Carbondale, Delta, Eagle, Hotchkiss, Montrose and Telluride Village, to name a few.Worcester said he was first approached about the issue by part-time Aspen resident Jack Grynberg, president of Grynberg petroleum, a company that sells its petroleum to natural-gas companies, including Kinder Morgan.”I remembered from high school chemistry that this makes a lot of sense,” Worcester said on Thursday. “I thought there was a lot of merit to his point [about the overcharging] and when I brought it to the council’s attention, they told me to pursue it.”The Colorado Consumers Legal Foundation is representing both cities in the lawsuit, as well as absorbing its costs, Worcester said. The lawsuit seeks a monetary judgment to be paid to all the class members for the amount overcharged by the natural-gas companies, and an order from the court requiring the companies to adjust their bills to account for varying elevations of customers.Naomi Havlen’s e-mail address is nhavlen@aspentimes.com


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