NIPSCO gas bills are going up

September 21, 2018

MICHIGAN CITY — Homeowners will see natural gas bills go up about $8 a month after the Indiana Utility Regulatory Commission approved a rate hike, though that’s lower than what NIPSCO had been seeking.

The increase, effective Oct. 1, will be phased in over a two-year period, and is $48.9 million less than the utility had requested, according to the Indiana Office of Utility Consumer Counselor.

On Wednesday, both NIPSCO and IOUCC announced the increase, the result of a settlement agreement between the utility, the agency, industrial customers and the NIPSCO Gas Supplier Group.

“Maintaining affordable energy costs for customers is essential,” NIPSCO president Violet Sistovaris said in a statement. “This balanced outcome allows us to continue to improve service and provides a platform for continued investments in public safety and other programs to better serve customers now and into the future.”

According to NIPSCO, the average residential natural gas customer will see an overall increase of approximately $8 per month, instead of $10 in the original proposal.

The IOUCC said $3 of that increase will be in the residential customer charge, which will go from $11 to $14 per month, much less than NIPSCO’s proposed $19.50.

The rate of increase for individual commercial and industrial customers will vary depending on usage patterns, but on average, rates will increase less than the original proposal, NIPSCO said.

The agreement will also resolve all issues regarding tax relief due to the federal Tax Cuts & Jobs Act, including crediting customers for 2018 taxes collected at the former 35 percent rate, according to IOUCC.

It allows NIPSCO a 9.85 percent return on equity, while the utility had originally sought a 10.7 percent rate of return.

The decision follows “extensive regulatory review and public input,” according to IOUCC, and is based on an agreement reached earlier in the year.

“This agreement will ensure that the utility will have the revenues needed to complete numerous upgrades throughout its gas transmission and distribution system, while mitigating the rate impact as much as possible,” said Indiana Utility Consumer Counselor Bill Fine.

“The IOUCC is committed to addressing aging infrastructure, reliability and safety, which will continue to be critical issues for utilities and their customers throughout the nation.”

It has been more than 25 years since NIPSCO’s base natural gas rates have increased, the utility said, and in 2010, a regulatory review led to a slight decrease.

NIPSCO said even with the higher rates, it anticipates remaining among the state’s lowest-cost natural gas providers.

Electric rates will not be affected.

—From staff reports

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