AARP has asked to formally intervene in the MDU natural gas rate case now pending before the North Dakota Public Service Commission.
AARP’s Josh Askvig says the organization has two issues with the current rate case. He says one is the “fixed cost” for delivering natural gas – that is, the basic cost before the actual price of the gas is added.
"In 2013, the fixed charge was $9 a month," said Askvig. "Last year, they raised it to $15 a month. A year later, they're asking to raise it another 40 percent, to $21 a month."
Askvig says that essentially eliminates part of a consumer's ability to regulate the gas bill through the amount of gas used.
"That really will hurt consumers in the summer months, when most use little to no natural gas," said Askvig.
Askvig says a second issue deals with MDU’s allowed “rate of return,” or profit margin.
"If MDU undercharges you, and that rate of return is less than 9 1/2 percent, they can raise your rate with only a cursory review by the PSC," said Askvig. "If it's higher than 10 1/2 percent, MDU gets to keep half of the extra profit."
Askvig says he doesn't understand that profit sharing plan.
"If you get overcharged for an item you buy at the store, you should get that amount back," said Askvig. "It's a sweet deal for them, but it's at the expense of hard working North Dakotans."
Askvig says intervenor status means AARP will be a full participant in the formal hearing, to be held later this summer.