Settlement will reduce Duke gas rate increase
Thursday, February 28, 2008
CINCINNATI — Duke Energy Ohio's requested increase in natural gas rates for its customers has been cut nearly in half under an agreement negotiated with consumer advocates and commercial customers, Duke said Thursday, Feb. 28.
Under the settlement, Duke will request a 3 percent increase that would generate an $18.2 million increase in annual revenues, down from the company's original request of a 5.8 percent increase which would have boosted the annual revenues by $34.1 million.
Extras
The settlement is subject to approval by the Public Utilities Commission of Ohio. Duke said it worked out the deal with consumer advocates including the Ohio Consumers' Counsel, Ohio Partners for Affordable Energy and People Working Cooperatively, along with the city of Cincinnati, Kroger Co. and natural gas marketers including Direct Energy and Interstate Gas Supply.
The agreement will allow Duke to continue, through 2018, passing along to customers its costs of replacing decades-old gas mains, which in some cases have begun leaking. The deal would cap that charge in a customer's monthly bill to a maximum of $9.20, rather than the $13.77 Duke originally proposed, said Ryan Lippe, a spokesman for state Consumers' Counsel Janine Migden-Ostrander.
But the settlement does not resolve the company's dispute with consumer advocates over proposed substantial increases in the monthly service charge that Duke imposes to recover its costs of maintaining local gas delivery infrastructure.
Duke has proposed increasing that fixed monthly charge from the current $6 to $15, while the PUCO staff recommended allowing that to increase to between $20 and $25. Consumer advocates oppose this, saying the higher fixed charge may discourage customers from trying to conserve energy. Lower gas consumption would not reduce the service charge.
The PUCO will hear that issue in March.
The company's service area extends from the Springboro area south to the Ohio River.
Public hearing
Customers of Duke Energy Ohio's natural gas service can comment at a public hearing on the proposed rate increase.
The Public Utilities Commission of Ohio will convene the hearing Tuesday, March 11, at 6:30 p.m. at Mason Middle School, 6370 Mason-Montgomery Road, Mason. It replaces a Feb. 21 hearing canceled because of bad weather.
