Lawrence residents would pay another $4.40 a month for natural gas beginning next summer, under a rate request submitted Wednesday to state regulators.

The request is part of a plan that would pump another $7.2 million a year into Aquila Inc., the Kansas City, Mo.-based company that provides natural gas service to 106,000 customers in Kansas, including about 33,000 in Lawrence. The company’s Kansas gas operations are based in Lawrence, at 110 E. Ninth St.

Aquila says it needs the money to offset cost increases for health insurance, motor fuel and other expenses necessary to keep its 4,000 miles of Kansas gas lines up and running.

“Kansas gas employees annually drive more than 1.75 million miles throughout the company’s vast Kansas service territory, so even small increases in gasoline and fleet maintenance costs have a substantial impact,” said Chuck Loomis, vice president for Aquila’s Kansas gas operations.

But David Springe, consumer counsel for the Citizens’ Utility Ratepayer Board, said that cost-recovery wasn’t the only thing on the minds of Aquila officials in making their request. The company’s application also seeks a 12 percent return for Aquila shareholders, which would outpace the 11.2 percent recently requested by Kansas Gas Service and 10 percent previously granted to Westar for electric operations.

“By all rights, Aquila is asking for a very high level of profit for shareholders, which is just greedy,” said Springe, who leads the state-mandated independent agency that studies utilities’ rate requests on behalf of residential and small-commercial customers. “That’s just a high level of greed, asking for that level of resources.”

Lavern Squier, president of the Lawrence Chamber of Commerce, said that he had learned of the utility’s request during a meeting Tuesday. He’s anxious to learn details of the application.

“Businesses certainly incur rising costs, but we want to be watchful of this,” he said.

The Kansas Corporation Commission, which regulates utilities, received Aquila’s rate request Wednesday and has until June 29 to decide whether to grant the full request, make adjustments or reject it entirely.

In November 2004, Aquila asked regulators for permission to charge Kansas customers another $6.2 million to cover costs, but settled in May 2005 for $2.7 million. That boosted the typical monthly residential bill by $2.50, to $61.80.

In the request filed Wednesday, Aquila said that it would seek another $4.40 from residential customers each month, boosting the current average bill by 5.9 percent to $79.58.

Typical commercial customers also would see their bills rise by nearly $6 a month, or 3.9 percent to $156.88.

Springe said that the combined overall rate increase described by Aquila – 5.1 percent – was deceiving.

Three-quarters of a typical gas bill goes for buying the gas itself, a cost that is “passed through” to customers and therefore has no bearing on whether the company makes or loses money, Springe said. The cost of gas currently is more than one-third cheaper than it was a year ago.

Looking only at the expense factors that Aquila must take on itself – such as buying and installing gas lines, meters and other materials, plus covering salaries, insurance coverage and other items – changes the perspective, he said.

“It’s a 21 percent increase on the portion of the bill that the utility is responsible for,” Springe said. “It’s not 5.1 percent. It’s 21 percent. It’s a somewhat deceptive way to make the increase not look as much as it really is.”

Aquila also is seeking to adjust its billing structure, so that some costs now assessed based on customer usage would instead be assigned the same level each month.

The switch would reduce high gas bills in the winter and add slightly to traditionally low bills in the summer, said Curt Floerchinger, an Aquila spokesman.

“It would be easier to budget throughout the year,” he said.

Such a consistent revenue stream would reduce risk for the utility’s shareholders, Springe said, and therefore would be expected to reduce the need for shareholders to command a return of 12 percent.

“It’s completely out of proportion to the risk the company faces,” Springe said.

Rosemary Foreman, a spokeswoman for the corporation commission, said that the commission would review the application and ask the utility for any additional information deemed necessary. The commission then schedules public hearings to review the case and accept public comments before reaching a settlement with the utility or rendering a decision.