Press Release

PUC Approves Rate Decrease for Harrisburg Steam Heat Provider

Published on 1/11/2007

Filed under: Gas

HARRISBURG – The Pennsylvania Public Utility Commission (PUC) today approved a decrease in the steam cost rate (SCR) for NRG Energy Center Harrisburg.

The Commission approved the rates by a vote of 4-0. The rates are to become effective with service rendered on or after Jan. 1, 2007.  This was an interim filing for the company, whose annual rates for the fiscal year beginning September 2006 were approved by the Commission Aug. 17, 2006.

The total steam cost billing rate (SCR plus base fuel cost) for rate schedule HSW-1 will decrease $1.89 per thousands pounds (Mlb) from $21.78 to $19.89 (8.7 percent). For rate schedule HSW-2, the total steam cost billing rate will decrease $1.51 per Mlb from $16.41 to $14.90 (9.2 percent).

NRG provides steam heat for commercial, institutional and residential entities. It serves 270 downtown Harrisburg customers totaling 11 million square feet of space. Steam heat typically is produced in a centralized location by heating water to its boiling point, then distributed to users through a series of underground pipes. NRG also purchases steam from the Harrisburg incinerator.

The steam generation plants may be fueled by natural gas and oil. By law, the company is permitted to pass fuel costs related to powering the steam generation plant on to customers. The company is not permitted to charge consumers more than what it pays for fuel, but rather must charge a dollar-for-dollar pass through of those costs.

NRG’s decrease is attributed to lower prices for natural gas and fuel oil than anticipated in the rates effective Sept. 1, 2006.  Steam heat providers file for an annual revision to the SCR, which reflects the change in price paid by the utility for fuel, reconciled with under collections or over collections that result from differences in actual sales revenues and actual fuel costs from the prior year. Companies may apply for interim changes to the SCR if the existing rate is significantly over or under recovering fuel costs.

The Pennsylvania Public Utility Commission balances the needs of consumers and utilities to ensure safe and reliable utility service at reasonable rates; protect the public interest; educate consumers to make independent and informed utility choices; further economic development; and foster new technologies and competitive markets in an environmentally sound manner. For recent news releases, audio of select Commission proceedings or more information about the PUC, visit our Web site at www.puc.state.pa.us.

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Docket No. M-00061970

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