August 31, 2018

CT, CNG settlement reduces rate increase request by $27M

PHOTO | Contributed
PHOTO | Contributed
A work crew installs a section pipeline that will carry natural gas from Waterbury and Wallingford.

Connecticut's consumer watchdog said it has agreed to a rate increase settlement with Connecticut Natural Gas Corp. (CNG), potentially ending an "intense" two-month negotiation period.

The state Office of Consumer Counsel (OCC) said the settlement would reduce CNG's rate increase request by about $26.8 million over three years if approved by the Public Utilities Regulatory Authority (PURA). OCC filed the settlement agreement with PURA on Friday.

CNG, which provides natural gas to 176,000 customers statewide, filed a rate increase request on June 29, stating it was necessary to offset significant capital investments that were not yet reflected in rates. CNG rates have not been changed since 2014, OCC said.

Under the initial request, CNG sought rate increases of about $16.5 million in 2019, $26.6 million in 2020 and $27.8 million in 2021, which total $71 million in additional revenue over three years. The settlement, however, reduces those increases to $9.9 million in 2019, $14.5 million in 2020 and $19.7 million in 2021, amounting to $44.1 million.

"While no rate increase is good news, our efforts mean that $27 million remains in the pockets of CNG's customers," OCC chief Elin Swanson Katz said. "At the same time, we have ensured that CNG can continue to safely and reliably provide natural gas to our residents.

In addition to other settlement terms, CNG has agreed to also launch a $1.5 million annual grant program in 2020 to assist customers that face mounting debt.

OCC said it expects PURA to reach a decision by November or earlier. Rate increases would take effect Jan. 1, 2019.

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