Columbia Gas of Maryland Files to Recover Investment in Replacing Aging Infrastructure
MERRILLVILLE, Ind., April 13, 2018 /PRNewswire/ -- Columbia Gas of Maryland, Inc. (Columbia Gas), a subsidiary of NiSource Inc. (NYSE: NI), filed a request today with the Public Service Commission of Maryland (PSC) to adjust its base rates for distribution service so it can continue to replace aging pipeline and adopt pipeline safety upgrades.
"Our number one priority is maintaining the safety of our customers and the communities we serve," said Mike Huwar, president of Columbia Gas of Maryland. "We have made, and will continue to make, substantial capital investments in our system to update the safe and reliable system we currently operate. We believe this filing provides a number of tangible benefits to our customers."
From 2007 to 2017, Columbia Gas invested over $120 million in the modernization and expansion of its distribution system in Maryland. Of that amount, approximately $80 million was dedicated to replacing 72 miles of aging bare steel and cast iron pipe. In 2018, Columbia Gas will invest approximately $25.7 million in Maryland, with $21 million being invested to upgrade aging underground infrastructure.
"We are proud of our pipeline replacement program and our ability to continue to serve our valued customers safely and reliably, but our work doesn't stop there," said Columbia Gas of Maryland Vice President and General Manager Mike Davidson. "We also remain committed to providing a positive customer experience through an educated and trained workforce focused on safely meeting or exceeding all federal and state requirements while operating our distribution system."
In today's filing, Columbia Gas is seeking an annual revenue increase of approximately $6 million.
"We are working more efficiently than ever, and we will continue to look for additional ways to make the most cost-effective decisions for our customers," said Huwar.
If the adjustment is approved by the PSC, the average total bill for a residential customer who purchases 70 therms of gas per month from Columbia Gas would increase from $76.72 per month to $87.03 (a 13.44 percent increase). The average total bill for a small commercial customer who purchases 250 therms of gas per month from Columbia Gas would increase from $258.24 per month to $287.77 (an 11.44 percent increase). The average total bill for an industrial customer who purchases 4,040 therms of gas per month from Columbia Gas would increase from $2,948.47 per month to $3,011.80 (a 2.15 percent increase).
Columbia Gas of Maryland Director of Rates and Regulatory Affairs Nicole Paloney noted, "The impact on the customer's bill associated with this filing is softened thanks to continued low, stable natural gas costs. On behalf of our customers, we work with suppliers to secure the best possible natural gas prices, while maintaining the reliability of gas supply during peak demand periods."
Gas costs generally represent about a third of a residential customer's total bill. Columbia Gas purchases its gas on the wholesale market and under Maryland law, passes these costs on to its customers without mark-up or profit. The gas cost portion of a residential customer's monthly bill is based entirely on a home's monthly gas consumption.
Tax calculations for our customers' rates in this filing have been made reflecting the Tax Cuts and Jobs Act of 2017 (TCJA) which was signed into law December 22, 2017. The proposed rate adjustment reflects the new 21 percent corporate federal tax rate, which was reduced from 34 percent under the TCJA effective January 1, 2018. Additionally, customers' bills started to reflect the new tax rate in April 2018, and Columbia Gas of Maryland is currently passing back to customers the difference between taxes collected at the federal 34 percent tax rate versus the 21 percent tax rate from January 1, 2018 to March 31, 2018.
The process for a general rate proceeding before the PSC can take up to seven months and Columbia Gas expects that new rates would be effective near the end of 2018.
About Columbia Gas of Maryland
Columbia Gas of Maryland delivers clean, affordable, and efficient natural gas to approximately 33,000 customers in Garrett, Allegany and Washington counties. It is one of NiSource's seven regulated utility companies. NiSource (NYSE: NI) is one of the largest fully-regulated utility companies in the United States, serving approximately 3.5 million natural gas customers and 500,000 electric customers through its local Columbia Gas and NIPSCO brands. More information about Columbia Gas of Maryland and NiSource is available at www.ColumbiaGasMD.com and www.nisource.com.
About NiSource
NiSource Inc. (NYSE: NI) is one of the largest fully-regulated utility companies in the United States, serving approximately 3.5 million natural gas customers and 500,000 electric customers across seven states through its local Columbia Gas and NIPSCO brands. Based in Merrillville, Indiana, NiSource's approximately 8,000 employees are focused on safely delivering reliable and affordable energy to our customers and communities we serve. NiSource has been designated a World's Most Ethical Company by the Ethisphere Institute since 2012 and is a member of the Dow Jones Sustainability - North America Index and was named by Forbes magazine as the top-rated utility among America's Best Large Employers in 2017. Additional information about NiSource, its investments in modern infrastructure and systems, its commitments and its local brands can be found at http://www.nisource.com. Follow us at http://www.facebook.com/nisource, http://www.linkedin.com/company/nisource or http://www.twitter.com/nisourceinc. NI-F
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of federal securities laws. Many factors govern whether any forward-looking statement contained herein will be or can be realized. Any one of those factors could cause actual results to differ materially from those projected. Examples of forward-looking statements in this press release include statements and expectations regarding NiSource's or any of its subsidiaries' business, performance, growth, commitments, investment opportunities, and planned, identified, infrastructure or utility investments. All forward-looking statements are based on assumptions that management believes to be reasonable; however, there can be no assurance that actual results will not differ materially. Factors that could cause actual results to differ materially from the projections, forecasts, estimates, plans, expectations and strategy discussed in this press release include, among other things, NiSource's debt obligations; any changes in NiSource's credit rating; NiSource's ability to execute its growth strategy; changes in general economic, capital and commodity market conditions; pension funding obligations; economic regulation and the impact of regulatory rate reviews; NiSource's ability to obtain expected financial or regulatory outcomes; any damage to NiSource's reputation; compliance with environmental laws and the costs of associated liabilities; fluctuations in demand from residential and commercial customers; economic conditions of certain industries; the success of NIPSCO's electric generation strategy; the price of energy commodities and related transportation costs or an inability to obtain an adequate, reliable and cost-effective fuel supply to meet customer demands; the reliability of customers and suppliers to fulfill their payment and contractual obligations; potential impairments of goodwill or definite-lived intangible assets; changes in taxation and accounting principles; potential incidents and other operating risks associated with our business; the impact of an aging infrastructure; the impact of climate change; potential cyber-attacks; construction risks and natural gas costs and supply risks; extreme weather conditions; the attraction and retention of a qualified work force; advances in technology; the ability of NiSource's subsidiaries to generate cash; tax liabilities associated with the separation of Columbia Pipeline Group, Inc.; NiSource's ability to manage new initiatives and organizational changes; the performance of third-party suppliers and service providers; the availability of insurance to cover all significant losses and other matters set forth in Item 1A, "Risk Factors" section of NiSource's Annual Report on Form 10-K for the fiscal year ended December 31, 2017 and in other filings with the Securities and Exchange Commission. NiSource expressly disclaims any duty to update, supplement or amend any of its forward-looking statements contained in this press release, whether as a result of new information, subsequent events or otherwise, except as required by applicable law.
SOURCE NiSource Inc.
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