Los Alamos County Proposes Natural Gas Rate Hike to Cover Operational Costs

The typical Los Alamos household gas bill would jump $11.08 per month under a rate structure proposal released Thursday by the County's Department of Public Utilities, the first of two planned increases that would push the average monthly charge from $67.45 today to $86.93 by July 2027.

The DPU presented the proposed ordinance to the Board of Public Utilities at a work session April 1. If the BPU approves it at a public hearing on May 6, the measure moves to the County Council for introduction on May 19 and a second public hearing on June 9.

The department's explanation centers on a quiet revenue erosion: average residential consumption has fallen to about 70 therms per month from a historical norm of roughly 75, a shift DPU attributes to warmer annual temperatures over the past five years. Because the utility earns most of its revenue from the volume of gas sold, declining usage has opened a gap between what DPU collects and what it costs to run the system, even as fixed operational and maintenance costs remain unchanged.

The proposed two-phase structure is designed to close that gap incrementally. The first adjustment, effective July 1, 2026, sets the estimated average residential bill at $78.53 per month, a 16.4 percent increase. A second increase taking effect July 1, 2027 would raise the average bill to $86.93, an additional 10.7 percent over the 2026 rate. Cumulatively, the pair of increases would add approximately $19.48 to monthly bills, or roughly 28.9 percent above today's rate.

DPU warned that failing to adopt the ordinance would likely force the utility to curtail gas system maintenance and replacements, degrading reliability and increasing the risk of a larger, more abrupt rate correction in the future. The department's financial guidelines also require building cash reserves to cover debt service, system retirement obligations, and emergency repairs.

The 70-therm monthly figure is a year-round average. In Los Alamos, which sits above 7,200 feet in elevation, winter heating bills will run well above the modeled estimate for much of the season. Restaurants, commercial kitchens, and other high-use facilities that depend on gas year-round would face a proportionally steeper dollar impact than the residential baseline suggests.

The public hearings on May 6 and June 9 are the principal windows for residents and business owners to shape or oppose the ordinance before it takes effect. Questions worth raising at either session include what the specific annual dollar shortfall is, which maintenance or infrastructure projects would be deferred without the rate increase, and how future wholesale gas price volatility is accounted for in the rate structure. For broader context, New Mexico Gas Company recently agreed to a settlement that would raise an average budget-billing customer using 53 therms by about $4.21 per month, a 7.1 percent increase. DPU's first-phase hike is more than double that percentage, though the two utilities operate under fundamentally different frameworks: NM Gas Co. is regulated by the Public Regulation Commission, while DPU is a community-owned municipal utility accountable directly to the BPU and County Council.

Households with affordability concerns can apply for heating assistance through the federal Low Income Home Energy Assistance Program, administered in New Mexico by the Health Care Authority. The program's FY2026 heating benefit runs from $70 to a maximum of $490, with eligibility set at 150 percent of the federal poverty level. Applications are accepted through the state's YesNM portal.

The proposed ordinance text and a frequently-asked-questions document are posted on the DPU rates and fees webpage. All BPU meetings are hybrid, accessible both in person and online.