Sherman and Denison joined a number of cities across Texas in accepting the new Atmos Energy rates that will go into effect Oct. 1


Every year the a consortium of cities works with Atmos Energy to negotiate natural gas rates for customers. This year the rates will be increasing slightly and the steering committee made up of a large number of Texas cities determined a rate deemed suitable on behalf of the residents of the respective communities.


Here are five things to know about the change.


1. There are 171 member cities


Denison and Sherman join a team of 171 total cities in the steering committee. The consortium helps negotiate rates on behalf of the individual cities. It is made up of a group of cities, known as the Atmos Cities Steering Committee and Atmos Energy Corp. Mid-Tex Division.


2. Rates will be increasing


The average residential rate will increase by 3.7 percent or $2.05 per month. The average commercial increase is $6.18 or 2.31 percent. Although the rates are increasing, they are doing so at a substantially lower rate than what Atmos was originally requesting. The committee reviewed the findings and negotiated a lower rate increase.


3. It is an annual process


Every year the committee works with Atmos to review rates through a mechanism known as the rate review mechanism. The RRM reviews rates annually and the cities negotiate with Atmos through the process.


4. The increase is a settlement


Atmos was requesting an additional $70 million in revenues, $54 million to come from the member cities. The RRM negotiated a settlement of $35.4 million, a saving to member cities of $18.6 million dollars. The process allows the cities to negotiate rates on behalf of the residents. The rates are still going up, they will be going up less than Atmos was requesting.


5. Rates go into effect Oct. 1


Member cities have until the end of September to adopt resolutions accepting the rate settlement. The rates will be uniform across the member cities.


Richard A. Todd is a reporter for the Herald Democrat. He can be reached via email at rtodd@heralddemocrat.com. He can also be found on Facebook and Twitter @RichardAToddHD.