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Columbia Gas gets pipeline charge OK

| Friday, March 15, 2013, 12:01 a.m.

Columbia Gas of Pennsylvania is the first natural gas utility in Pennsylvania to win approval for a new type of charge on customers' bills to pay for pipeline work.

How much customers will pay won't be known for days — although the charge could take effect April 1, the company and state utility regulators said on Thursday.

Columbia asked the state Public Utility Commission in January for permission to impose a fee known as a distribution system improvement charge that totaled 1.9 percent of its non-gas revenue, or about 62 cents a month for an average household using 73 therms of gas.

Later calculations changed the proposed rate to 2.29 percent, PUC spokeswoman Denise McCracken said, but commissioners didn't set a final number when they voted 5-0 to OK the charge and the company's pipeline replacement plan. Columbia must submit more documents by March 20, and the surcharge could take effect 10 days later.

Columbia spokeswoman Rachel Ford declined to comment on the surcharge until the utility receives the PUC's final order. Columbia is part of NiSource Inc., which has been aggressively tearing up old steel and iron pipes to install new lines; Ohio, Kentucky and Massachusetts are states where the company operates that have charges similar to the distribution charge allowed under Pennsylvania's year-old law.

The Pennsylvania utility will spend more than $140 million on projects in 2013, up from $114 million last year, Ford said, and it intends to replace at least 100 miles of its system every year. Columbia serves 415,000 customers in 26 counties.

Six other utilities statewide are seeking PUC permission to assess one of the new fees. Columbia and other gas and electric companies lobbied for the tool that allows them to recover what they spend on infrastructure more quickly than they could through a typical rate case that takes nine months to litigate. Water utilities have been able to charge the fees for 15 years.

Tanya J. McCloskey, the state's acting consumer advocate, said her office is examining Columbia's calculations for its new fee and a separate rate case the utility filed in September that hasn't been approved.

That request for a 23.4 percent hike — or an average of $16 a month — is “a major rate case, that isn't scheduled to take effect until summer. There will have to be coordination” with the distribution charge, McCloskey said.

Other utilities taking steps toward distribution surcharges are Peoples Natural Gas and related utility Peoples TWP, Equitable Gas in the Pittsburgh area and electric utility PPL and gas companies PGW and PECO Gas.

Kim Leonard is a staff writer for Trib Total Media. She can be reached at 412-380-5606 or kleonard@tribweb.com.

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