UGI Gas gets OK for increase in base rates

Residential customers will see an increase of 7 percent

The Pennsylvania Public Utilities Commission has approved a settlement in UGI Gas Utilities’ base rate case filing that will raise customer heating bills.

The settlement, approved Sept. 1, will result in an increase in base rates of $27 million and means customers will see higher energy bills. The base rate increase will go into effect on Oct. 19.

The settlement was announced the same day an increase in purchased gas costs went into effect. That increase represents the cost of the natural gas and transportation to get the gas into the system, according to the utility. It is adjusted quarterly.

Under the terms of the PUC settlement, a typical residential heating customer will see their monthly bill increase from $59.23 to $63.41, each month — an increase of $4.17, or 7 percent.

A typical commercial customer will see its bill increase by approximately 1.5 percent, from $397.79 to $403.58 per month. A typical industrial customer will see its bill increase by approximately 2.2 percent from $1,309.49 to $1,338.90 per month.

UGI initially filed in January for a $58.6 million dollar increase in annual base rate operating revenues. The PUC voted 5-0 to approve the settlement, which reduces UGI’s rate increase by nearly 54 percent and resolves all other issues related to the company’s request.

“UGI believes the settlement represents a fair outcome for both the company and our customers,” said Robert F. Beard, president and CEO of UGI Utilities. “We are aware that an increase in rates will impact our customers. However, we worked hard to balance that customer impact with providing the means to continue to maintain safe and reliable gas service to the many communities we serve.”

This is the first base rate increase for UGI in 21 years, according to UGI spokesman Joe Swope.

“The base rate is the cost of operating the company, from employee wages and benefits, to the cost of our facilities and pipelines, to reading meters, providing emergency service, etc.,” he said.

The settlement also includes implementation of an energy efficiency and conservation program. This program provides customers access to a variety of conservation programs, services and tools, including equipment rebate programs and incentives for residential and commercial customers.

In the approved settlement, parties agreed that nearly $2.7 million of the overall $27 million increase would go toward funding the first year of UGI’s new Energy Efficiency and Conservation (EE&C) plan, according to a PUC press release.

Even with this increase, natural gas continues to be an excellent value. The average total bill for customers will be significantly lower than in 2008, according to the utility, according to a UGI press release.

UGI Utilities, Inc. — Gas Division serves 372,000 customers in 16 eastern and southcentral counties in Pennsylvania, including parts of Berks, Chester and Montgomery counties. Additional information about UGI is available at www.ugi. com on Facebook at www. facebook.com/ugiutilities; and Twitter at www.twitter.com/ugi_utilities.

Email business story ideas to business editor drovins@pottsmerc.com