Press Release

PUC Approves Settlement Regarding Purchase of Receivables Program for National Fuel Gas Distribution Corp. Customers

Published on 6/3/2010

Filed under: Gas

     The Pennsylvania Public Utility Commission today modified a settlement agreement requesting approval of a program for purchase of natural gas supplier accounts receivables for National Fuel Gas Distribution Corp. (NFG)

     The Commission voted 3-1 to modify a motion of Chairman James H. Cawley, and Vice Chairman Tyrone J. Christy issued a dissenting statement.

     The settlement, which allows NFG to terminate service to customers for failure to pay the lesser of billed charges, including natural gas supplier (NGS) service charges or other NFG charges, and refuse to reconnect service for failure to pay the lesser of the billing charges.

     Also under the settlement, NFG is granted a waiver of any regulation that would prohibit it from terminating service to customers or failing to reconnect service to customers for failure to pay the lesser of: (1) a consolidated bill reflecting billed NGS charges, including charges for carbon-neutral products, or (2) an otherwise applicable consolidated bill reflecting NGDC supply charges. 

     The settlement stems from Commission-issued guidelines, for the design and operation of purchase of receivable programs (POR).

     The Commission voted 5-0 on Dec. 18, 2009, to create POR guidelines to assist natural gas distribution companies (NGDCs) in the voluntary creation of POR programs. The Commission has said that POR programs are perhaps the best chance to increase effective competition in Pennsylvania’s retail natural gas supply services market.

     The interim guidelines provided general direction to utilities for the design of purchase of receivables programs but granted flexibility to each of the state’s NGDCs on other design elements because of the NGDC's different demographics, billing and collection operations and system operating requirements. The interim guidelines provided a framework which balances the interests of the NGDCs, the natural gas suppliers and the customers.

     Today’s action is part of the Commission’s action plan to increase effective competition in the retail market for natural gas supply. The action plan was approved on Sept. 11, 2008. This followed a Commission finding that “effective competition” did not exist in the retail natural gas supply market statewide. The PUC then convened natural gas industry stakeholders to examine avenues to increase competition. The name SEARCH (Stakeholders Exploring Avenues for Removing Competition Hurdles) was adopted for these group meetings.

     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. P-2009-2099182

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