Columbia Gas of Ohio proposes to triple its fixed monthly rate for natural gas
By: Renée Fox | WOSU
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COLUMBUS, Ohio (WOSU) — Columbia Gas of Ohio is asking the Ohio Public Utilities Commission to approve tripling the fixed monthly distribution fee that 1.4 million customers pay before the cost of using natural gas is added to the bill.
If the PUCO approves the 2021 request, the fee would go from about $17 per month to about $46 per month.
Eric Hardgrove, director of state communications for the company, said the company hadn’t requested such a raise since 2008 and had evidence to prove the raise was necessary.
“To continue to provide safe, affordable and reliable natural gas service, we must continue to invest in our system to upgrade aging infrastructure, just as investments are made in bridges, roads and other infrastructure in our cities. , villages and communities,” Hardgrove said. .
The company did not provide someone for an interview and did not respond to questions asking for explanations and more information.
The Ohio Consumer Council, a state agency responsible for monitoring consumers during rate increase requests and other situations, thinks the demand is far too great and would hurt low-income users.
“High monthly fixed charges have a disproportionate negative impact on low-income, low-power residential consumers. And they also rob consumers of the opportunity to lower their gas bills by reducing their consumption,” said JP Blackwood, acting director of public affairs at the OCC.
Columbia Gas’ proposal would raise $212 million by raising monthly distribution service fees, which could even exceed $46 per month to $80 per month in five years, according to the OCC.
In a 255-page staff report, PUCO recommended a fee increase that would generate $35 million to $58 million for the company.
The consumer protection agency thinks the company should limit itself to a raise resulting in $10 million in new revenue.
Blackwood said the company has seen many other increases over the past 14 years, although that number hasn’t increased. Their request is simply too high and requires funds outside of the mission to provide natural gas, Blackwood said.
“The OCC has reviewed various expenses that Colombia has presented. And the kind of fees they can charge consumers are “used and useful” items to provide a secure supply of natural gas to consumers. That’s what they have to charge for, “used and useful” items to deliver this safe and reliable natural gas to consumers. And that’s what they should be allowed to charge,” Blackwood said.
Columbia’s proposal would generate an 11% profit. PUCO’s proposal would create a profit of 9% to 10% for the company.
The OCC wants to limit profit to 8.7%.
“Well, one of the things we looked at was what we think is a fair amount of profit for Colombia. They have a pretty secure investment and they have a captive consumer base – they operate like a monopoly. And we believe an 8.7% profit is an appropriate profit level in this scenario,” Blackwood said.
The OCC also wants PUCO to order Columbia Gas to set up a $10 million fund for bill-paying assistance and said consumers shouldn’t be charged in order to give bonuses to executives.
With inflation and other financial concerns, consumers in Ohio don’t need a fixed increase in their bills, Blackwood said.
“It’s a very bad time for a 27% increase in consumer bills and maybe more as these fixed rates go up. That’s a big concern,” he said.
PUCO is expected to issue a decision in the fall, but the case could take longer to go through the process.
Hearings for public comment on the proposal are scheduled for Tuesday, June 7 at 6 p.m. in the Athens City Council Chambers and Wednesday, June 15 at 6 p.m. in the Zanesville City Hall Council Chambers. .
People can also submit comments online or by mail. For more information and instructions, visit occ.ohio.gov/columbia.
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