Press Release

PUC Audit Shows Columbia Gas of PA Could See $9.9 Million in Annual and One-Time Savings

Published on 8/17/2006

Filed under: Gas

HARRISBURG—According to an audit report released today by the Pennsylvania Public Utility Commission (PUC), Columbia Gas of Pennsylvania Inc. could experience a yearly savings of about $9 million and one-time savings of $900,000 by implementing recommendations contained in the audit.

The Commission voted to make the audit report public and directed the company to proceed with its plan to implement the recommendations in the audit report.

Columbia Gas’s Implementation Plan indicated the company accepted 25 of the recommendations, partially accepted four, and rejected one.

Affiliated relations, customer service and gas system operations were rated as needing significant improvement.  Diversity & equal employment opportunity was rated as needing moderate improvement.  Some of the most significant recommendations accepted or accepted-in-part by Columbia Gas include:

• Expedite the replacement of bare steel facilities in the transmission and distribution system infrastructure;
• Initiate efforts to reduce the amount of accounts receivable write-offs by consistently enforcing appropriate company procedures both before and after accounts are written off;
• Enhance current measures to reduce long-term arrearages;
• Initiate actions to increase collection agency recovery rates;
• Adjust the budget billing process to effectively conform to PUC regulations by assuring that customers initial budget billing amounts properly reflect a monthly average of their expected annual usage;
• Refinance long-term debt to attain the benefits of the lower market rates now available; and others.

Additionally, the audit found that staffing levels for the gas control facility are inadequate during the summer and overnight shifts.  The concern is that safety of the system would be compromised if only one controller, rather than the recommended minimum of two, is monitoring gas distribution operating companies in five different states.  The company rejected that recommendation.  The issue was referred to the Commission’s Law Bureau prosecutory staff for further investigation.   

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.      D-04MGT035

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