UGI Seeks $110.4 Million Rate Increase for Natural Gas Delivery Services
TL;DR
UGI Utilities, Inc. requests base rate increase of $110.4 million annually for residential, commercial, and industrial customers to fund system improvements.
The requested rate increase will fund system upgrades and operations to ensure safe and reliable natural gas service for customers in Pennsylvania.
UGI's rate increase request, if approved, will support investments in improving the natural gas distribution system, facilities, and technology for better service.
UGI's rate increase proposal involves replacing non-contemporary pipelines with modern materials, reflecting a commitment to infrastructure enhancement and safety measures.
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UGI Utilities, Inc. has proposed a significant base rate increase for its natural gas delivery services, seeking to recover ongoing infrastructure and operational costs. The utility's request would raise annual rates by $110.4 million, affecting customers across 46 Pennsylvania counties.
The proposed rate adjustment would impact different customer segments differently. Residential heating customers could see their monthly bills rise from $104.47 to $115.74, a 10.8% increase. Commercial heating customers might experience an 8.6% bill increase, while industrial customers could face a 7.5% rate hike.
Central to the rate increase request is UGI's substantial investment of over $786 million in system improvements. These investments primarily focus on replacing older pipeline infrastructure with contemporary materials, aimed at enhancing system reliability and safety.
Importantly, the proposed increase would only affect the delivery charge portion of customer bills. This charge covers the utility's costs for maintaining the gas distribution system, providing customer service, and ensuring emergency response capabilities.
UGI has requested the new rates take effect on March 28, 2025. However, the Pennsylvania Public Utility Commission typically suspends such filings to conduct investigations and public hearings. Consequently, the actual implementation might be delayed until October 2025, extending the review process to approximately nine months.
The rate increase reflects the ongoing challenges utilities face in maintaining and modernizing critical energy infrastructure while balancing customer costs. For consumers, this proposed adjustment underscores the continuous investment required to ensure safe and reliable natural gas service.
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