Press Release

PUC Takes Conditional Action on Merger of UGI Penn Natural Gas & UGI Central Penn Gas into UGI Utilities, Inc.

Published on 9/20/2018

Filed under: Gas

HARRISBURG – The Pennsylvania Public Utility Commission (PUC) today took conditional action to approve a joint petition for settlement that merges UGI Penn Natural Gas, Inc. (Penn Natural) and UGI Central Penn Gas, Inc. (Central Penn) into UGI Utilities, Inc. (UGI Utilities).

The Commission voted 4-1 in support of a motion offered by PUC Chairman Gladys M. Brown, which modifies the settlement to require all three UGI natural gas entities to continue filings quarterly and annual earnings reports with the Commission, until further notice.

Chairman Brown noted that the clarified reporting requirement is necessary because the three UGI natural gas entities will continue to have separately tariffed Distribution System Improvement Charges (DSICs) and distribution charges. Under the Public Utility Code, a utility’s DSIC can be reset to zero if financial reporting indicates the utility is overearning.

Under the motion adopted today, the parties in this case will have five days to submit comments to the PUC regarding the financial reporting requirement.  If adverse comments are filed, the Commission will address those issues in a future order.  If there are no adverse comments, the joint settlement will be approved without further action by the Commission.

On March 8, 2018, UGI Utilities, Penn Natural and Central Penn (Joint Applicants) filed a joint merger application seeking to consolidate three, affiliated natural gas distributions companies (NGDCs) whose operation and management have become increasingly integrated over time.  The three NGDCs have been operating under one umbrella since UGI Utilities acquisition of Penn Natural and Central Penn more than a decade ago.

On July 20, 2018, the Joint Applicants filed a Joint Petition for Settlement among UGI, the PUC’s independent Bureau of Investigation and Enforcement, the Pennsylvania Office of Consumer Advocate, the Pennsylvania Office of Small Business Advocate and several parties representing natural gas suppliers.

In addition to substantial administrative, operational, capital and regulatory benefits, the settlement extends certain benefits to low-income customers, including the design of new programs to encourage enrollment in low-income and universal service programs, as well as includes improvements to UGI’s customer choice programs, including establishing uniform rules in each rate district.

Upon close of the merger, UGI Utilities will rename the currently effective tariffs of Penn Natural, Central Penn and UGI Gas as the tariffs of the UGI Central, UGI North and UGI South rate districts, respectively, of the new UGI Utilities, Inc. – Gas Division.

While the merger will result in name and structural changes for the UGI companies, there will be no changes to current consumer rates. Any future changes to rates would require approval by the Commission following extensive investigation and public input to determine if they are just and reasonable.

The Pennsylvania Public Utility Commission balances the needs of consumers and utilities; ensures safe and reliable utility service at reasonable rates; protects the public interest; educates consumers to make independent and informed utility choices; furthers economic development; and fosters new technologies and competitive markets in an environmentally sound manner.

Visit the PUC’s website at www.puc.pa.gov for recent news releases and video of select proceedings. You can also follow us on Twitter, Facebook, LinkedIn, Instagram and YouTube. Search for the “Pennsylvania Public Utility Commission” or “PA PUC” on your favorite social media channel for updates on utility issues and other helpful consumer information.

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Docket Nos. 
A-2018-3000381
A-2018-3000382
A-2018-3000383

Contact:

• Nils Hagen-Frederiksen
  Press Secretary
  717-418-2701
  nhagen-fre@pa.gov