Citizens Gas Receives Approval for Base Rate Adjustment

INDIANAPOLIS – Citizens Gas announced today that the Indiana Utility Regulatory Commission (IURC) has approved approximately a 3.6 percent increase in base rates for its customers in Marion County. The rate adjustment will increase the typical residential customer’s bill about $3.40 per month. The increase will be reflected on bills some customers receive in October. Even after the increase, Citizens Gas expects the typical customer’s bill to decline more than 4 percent over the November-March winter heating season compared to last year because of lower wholesale natural gas costs.

The Utility last increased its base rates in 1991. Since that time, the Utility estimates its overall cost of doing business has increased more than 35 percent.

“Citizens Gas had been able to avoid a base rate increase for 15 years, but annual increases in operating costs and investments to ensure safety and reliability made this modest rate increase unavoidable,” said Carey Lykins, President and CEO of Citizens Gas & Coke Utility.

The rate adjustment will increase the Utility’s net revenues about $14.7 million.

The base rate adjustment will apply to the Delivery and Service portion of the customer’s bill, which typically accounts for about one-fourth of monthly charges. The Delivery and Service charge covers costs for delivering gas to customers, investments to make pipeline systems safe and reliable, payroll and health care costs, property taxes and other operating expenses.

The base rate increase does not apply to the Gas Used charge, which typically accounts for three-fourths of monthly charges. The Gas Used charge is adjusted monthly to reflect the fluctuating wholesale price of natural gas, which is set by the market forces of supply and demand. All utilities in Indiana pass on gas costs on a dollar-for-dollar basis, with no retail profit added.

Lykins added that the Utility is working hard to hold down gas costs and help customers in need. “In addition to our effective gas purchasing strategy, Citizens Gas recently built the Heartland Gas Pipeline, a 25-mile pipeline in western Indiana that directly accesses gas supplies from Canada and the Western United States. The Utility estimates the Heartland Pipeline will save customers as much as $6 million per year starting this winter.

About Citizens Gas
Citizens Gas & Coke Utility is a Public Charitable Trust providing efficient and reliable energy services to more than 266,000 customers in and around Marion County. The Public Charitable Trust means the utility is managed only for the benefit of customers and the community.

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