(Source: Business Wire)
South Carolina Electric & Gas Company (SCE&G), principal subsidiary of SCANA Corporation (NYSE:SCG), today filed with the Public Service Commission of South Carolina (PSC) and the South Carolina Office of Regulatory Staff (ORS) for a $13.4 million, or 2.53 percent, overall increase to its retail natural gas base rates.
SCE&G is filing for the adjustment under terms of the Natural Gas Rate Stabilization Act, a South Carolina law designed to reduce volatility of customer rates by allowing for more efficient recovery of the costs that regulated utilities incur in expanding, improving and maintaining natural gas service infrastructure to meet the needs of customers. The law also works to reduce customer rates when increased revenues cause a utility's earnings to exceed its authorized return on equity. If SCE&G's actual ROE is more than 0.50 percent above or below the 10.25 percent return authorized by the PSC, SCE&G is required to file for a rate adjustment to bring earnings back to that authorized rate of return.
The information supporting SCE&G's filing will be reviewed by the ORS, which will issue an audit report by Sept. 1. The PSC will then review SCE&G's filing and the ORS audit report and will issue an order in October. If approved, the rate adjustment would be implemented with the first billing cycle of November 2009.
SCE&G Vice President of Natural Gas Operations Marty Phalen said significant declines in the wholesale cost of gas over the past 12 months have helped offset the impact the company's rate request will have on the bills of residential customers.
"Our residential customers will be paying an average of about $0.67 less a month for natural gas beginning in November than they were one year ago based on the current wholesale price of natural gas," said Phalen.
Phalen said today's rate filing is being driven primarily by increased costs associated with building, operating and maintaining SCE&G's system infrastructure. "This is about serving our customers safely and reliably," he said. "Meeting the growing demand for natural gas in homes and businesses throughout South Carolina requires that we continue making capital investments in our distribution pipeline and related facilities."
The proposed overall 2.53 percent increase to natural gas rates breaks out as follows:
5.66 percent for residential customers
2.53 percent for small/medium commercial customers
1.84 percent for large commercial/industrial customers.
PROFILE
SCE&G is a regulated public utility that provides natural gas service to approximately 309,000 customers in South Carolina.
