UGI Utilities wants its more than 700,000 customers to pay higher basic rates on top of a rate hike that went into effect in October.
The company asked the state Public Utility Commission on Wednesday to allow typical basic residential customer rates to rise by 8.7%, commercial rates by 6.4% and industrial rates by 6.3%.
In September, the PUC approved higher residential basic rates of 6.7% for a typical residential customer.
The basic rates do not include changes in gas costs, which occasionally raise or lower what customers pay during a year.
UGI estimates the latest base rate hikes would produce $99.4 million a year in new revenues. The money would help the utility cover the costs of system upgrades and to “maintain safe and reliable natural gas service,” according to a UGI news release.
What customers would pay
Under the proposed rates, residential heating customers who use 6,870 cubic feet of natural gas a month would see rates rise to $123.55 from $113.64, or 8.7%. Typical commercial customers using 26,800 cubic feet a month would pay $358.17, up from $336.74, or 6.4%. Typical industrial customers using 54,600 cubic feet a month would pay $688.65, up from $647.57, or 6.3%.
The estimates cover customers who buy gas from UGI. Customers who use other gas suppliers may face different rates.
The UGI rate increase request would affect only distribution charges, which pay for installing, operating and maintaining its gas distribution system and customer and emergency response services and other operations. Gas costs are adjusted almost automatically based on market prices during a year.
Where the money goes
The utility says the filing includes more than $468 million in critical safety upgrades to gas distribution pipes, information technology and other facilities.
The utility wants to replace older pipes with new ones made of modern materials and extend its weather normalization bill adjustment by five years.
The adjustment credits customers bill if temperatures are more than 3% colder than normal and charges a customer more if temperatures are more than 3% warmer than normal.
UGI says it will also keep contributing $1 million to a fund that gives low- and moderate-income customers grants of up to $600 to pay bills.
The utility wants the rates to take effect March 29, but the PUC usually suspends rate hike requests for investigation and public hearings. If the PUC approves higher rates, they would likely take effect in October.
The full rate hike request is available on the UGI website, ugi.com, by clicking on the “rate filing” link.
Customers with questions can call UGI toll-free at 1-800-276-2722.
UGI’s customers are spread across 46 of the state’s 67 counties.
