State utility regulators approved a rate increase for Columbia Gas of Pennsylvania Inc. customers that will raise an average residential bill by 6.3 percent -- or about $8 a month -- effective Tuesday.
The state Public Utility Commission voted 5-0 Thursday to raise the company's natural gas distribution rate by $41.5 million a year, less than the $59.9 million the company sought early this year.
Columbia has linked its request for a higher rate to its ongoing pipeline replacement projects, but spokesman George Stark said it also "is truly covering a lot of different pieces we have been maintaining" such as technology improvements, employees' wages and health care and other rising costs.
Bills for residential customers who use 7.2 thousand cubic feet of gas, or mcf, each month, for example, will rise from $127 to $135 a month.
This is the company's first distribution rate hike in 12 years. The increase, as originally proposed, would have raised homeowners' bills by about 11 percent.
The company has about 412,000 residential and commercial customers in 26 Pennsylvania counties.
The PUC settlement sets conditions. Columbia will raise its contribution to a program that helps low-income families weatherize their homes and conserve gas by $1.3 million, to a total $3 million, for example, and must improve call response times.
The company also can raise its customer charge, a flat rate that all customers pay for meter reading and maintenance, by 69 cents to $11.50.
Columbia, part of NiSource Inc., is spending $72 million a year to rebuild aging pipelines, with the goal of replacing 2,400 miles over the next two decades.
While the work is throughout the service territory, some major projects have been in Coraopolis and in Ellwood City, Butler County; Richeyville, Washington County, York and Bellefonte, near State College, Stark said.
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