Service rate rise sought

Rising construction costs and employee expenses contributed to the increase.
SHARON, Pa. -- National Fuel Gas is looking for a 7.5 percent rate increase in its service rates effective Nov. 14.
The company filed a request Wednesday with the Pennsylvania Public Utility Commission asking for an additional $22.7 million in operating revenues to cover increases in the cost of providing service.
The company noted that it received a 1.3 percent increase in service rates in January.
The company hadn't sought an increase in service rates during the previous nine years, said Nancy Taylor, senior manager of corporate communications.
The company has done all it can to control costs, including reducing manpower, consolidation of facilities and refinancing of debt at lower interest rates.
"But costs have continued to rise, making it necessary at this time to request an increase in the rates charged to our Pennsylvania customers," Taylor said.
Service rates are different from gas cost rates, which reflect the cost the utility company must pay for natural gas it buys to provide to its customers.
National Fuel raised its gas cost rates three times so far this year, up 3.1 percent in February, up another 4.2 percent in May, and 3.1 percent in August.
The company isn't allowed to make any profit on gas costs and can only pass along the exact cost of gas to its customers.
Impact on customers
If the PUC approves Wednesday's request, the average residential customer bill will rise from about $118 to about $127 per month.
Taylor said the latest increase is based on several factors, including the company's ongoing construction program, uncollectible accounts and employee costs.
The company serves 214,000 customers in 14 northwestern Pennsylvania counties, including 30,000 in Mercer County. The company has no customers in Lawrence County.
The PUC will examine the rate increase request and could grant all, some or none of the request.
The regulatory agency frequently conducts its own investigation to determine if a rate increase is needed.