Montana-Dakota Utilities Co. wants to bill its natural gas ratepayers to finance energy conservation incentives for some customers, including rebates to encourage buying more efficient thermostats and furnaces.

North Dakota's Public Service Commission gave the idea a frosty reception Friday, with Commissioners Kevin Cramer and Tony Clark saying high natural gas prices already give customers ample reason to conserve.

"Should customers who have been implementing energy-efficient equipment … be paying to give an incentive to customers who, economically, should be making that choice anyway?" Clark asked.

Commissioner Susan Wefald said MDU's plan would charge customers for services that other utilities and government agencies provide for free, including a booklet of tips for cutting energy bills and a Web site with suggestions on conservation.

The commission held an informal hearing on Montana-Dakota's proposals Friday. The three commissioners will decide at a future meeting whether to endorse or reject them, Clark said.

Montana-Dakota Utilities, which is a unit of MDU Resources Group Inc. of Bismarck, has about 85,000 natural gas customers. It serves most of North Dakota's largest cities, including Bismarck, Dickinson, Devils Lake, Jamestown, Mandan, Minot, Valley City and Williston.

Its state regulatory filing outlines a plan to offer rebates to customers who buy furnaces, boilers and water heaters that burn natural gas more efficiently.

Furnace rebates are pegged at $150, boilers at $100. The proposed water heater rebate is $30, while customers who buy a programmable thermostat would get $20 back. The thermostats are capable of adjusting a home's temperature several times during the day.

MDU sought to bill customers for the cost of the rebates, consumer information and Web site, and to make up revenues it would lose from delivering less natural gas to customers.

The charges would add between $4 and $5 to the yearly bill of a residential customer who uses 100 to 120 dekatherms annually.

Tamie Aberle, an MDU pricing and tariff manager, said the utility probably would not offer the rebates if the commission declined to allow the company to recoup its expenses from customers.

Wefald said she could support MDU's rebate plans, but demurred at having customers pay for MDU-distributed energy conservation booklets and a Web site.

Xcel Energy, which serves Grand Forks and Fargo, already has a "home energy analyzer" Web feature that customers may use, Wefald said.

"I have been able to go to numerous links already on the computer that offer me an opportunity to do an online energy audit," Wefald said. "Why would we want the customers to pay for another one?"

Clark and Cramer said it was unlikely they would support any of the changes. They said they disliked MDU's suggestion to have ratepayers foot the bill for rebates to other customers.

"It does look like an increase on all customers, to pay for the encouragement of a few customers who haven't yet put in some of these energy-saving appliances and measures, to do what economically they should be doing anyway," Clark said.