Press Release

PUC Investigates NFG Rate Increase Request

Published on 7/20/2006

Filed under: Gas

HARRISBURG, Pa. – The Pennsylvania Public Utility Commission (PUC) today voted to investigate a National Fuel Gas Distribution Corp. (NFG) request to increase natural gas rates by about $25.9 million (6.1 percent).

The Commission voted unanimously to investigate the company’s proposal that increases the annual bill for an average customer using about 995 ccf of natural gas by about $119. The average annual residential bill would increase from about $1,728 to $1,874. NFG serves about 210,000 customers in 14 counties in Pennsylvania.

By operation of law, the proposal will suspended for up to seven months for its proposed effective date. The Commission has until March 2, 2007, to make a final decision at a public meeting in Harrisburg. The Commission action opens and investigation and assigns the matter to the PUC Office of Administrative Law Judge for a recommended decision that may approve, reject or modify the proposal.

Commission Vice Chairman James Cawley also asked that the parties in the proceeding address a series of questions dealing with the company’s request to increase the level of fixed charges that consumers would pay.

“This proposed change raises important policy issues that affect this Commission’s goals of promotion and encouragement of conservation of natural resources, including natural gas,” Vice Chairman Cawley said in his questions directed to the parties. “Given the extremely volatile and currently high natural gas prices facing this nation, a policy that does not optimally reward consumers for conservation efforts, but instead charges fixed fees regardless of usage, should, I feel, be addressed by the parties to this case.”

According to the company’s filing, the proposed increase would provide revenues sufficient to recoup decreased sales, increased operating expenses and increases to rate base. It also would provide an operating income that more nearly approaches an overall fair rate of return, the filing said.

The Pennsylvania Public Utility Commission ensures safe, reliable and reasonably priced electric, natural gas, water, telephone and transportation service for Pennsylvania consumers, by regulating public utilities and by serving as stewards of competition. For recent news releases, or more information about the PUC, visit our website at www.puc.state.pa.us.

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Docket No. R-00061493

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