PUC Approves Modified UGI Proposals to Accelerate Replacement of Aging Natural Gas Pipelines
April 20, 2017
HARRISBURG – The Pennsylvania Public Utility Commission (PUC) today approved modified proposals from UGI Central Penn Gas Inc. (UGI-CPG) and UGI Penn Natural Gas Inc. (UGI-PNG) for an increase in customer charges to accelerate the replacement of aging natural gas pipelines and infrastructure.
The Commission voted 4-1 to modify and approve petitions submitted by the UGI-CPG and UGI-PNG, allowing for an increase in their Distribution System Improvement Charge (DSIC). The companies had requested that their DSIC be increased from the current maximum of 5 percent of billed distribution revenues to 10 percent. Today’s action by the Commission allows an increase in the DSIC rates to 7.5 percent, effective for bills rendered on and after July 1, 2017.
The Commission has long viewed the DSIC as a key component of the statewide effort to accelerate the replacement of aging and at-risk pipes. Act 11 of 2012 allows Natural Gas Distribution Companies, along with electric, water and wastewater utilities, to petition the PUC for approval of a DSIC to fund infrastructure upgrades. That surcharge of up to five percent has become an essential tool in accelerating the replacement of at-risk infrastructure, helping to dramatically increase the resources devoted to increasing the safety and reliability of natural gas distribution systems.
In June 2016 the Commission-approved a modified Long Term Infrastructure Improvement Plan (LTIIP) for UGI-CPG, which includes a 38.5 percent increase in infrastructure investments, with an anticipated spending of approximately $67.9 million from January 2016 through December 2018. Similarly, the Commission-approved a modified LTIIP for UGI-PNG, which included a additional $16.8 million in infrastructure spending from 2016 to 2018, or an increase of 24.5 percent. UGI plans to remove all cast iron distribution main from their systems in 14 years (by 2027) and all bare steel distribution mains from their systems in 28 years (by 2041).
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Pennsylvania Public Utility Commission
P.O. Box 3265, Harrisburg, PA 17105-3265
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