Unitil asks for $11.27 hike in basic customer charge
HAMPTON - Unitil Corp. on Monday announced that it will seek an increase in its basic customer charge for natural gas service, from a flat fee of $13.73 a month to $25 a month.
The customer charge is paid by all customers with natural gas service, and covers the costs of metering, billing and account maintenance.
It is not affected by the amount of natural gas used.
Company spokesman Alec O'Meara said the $11.27 increase in the customer charge will be offset by variable decreases in the distribution charges, which cover maintenance of the pipelines and other equipment needed for delivery.
He said the average customer, using about 90 therms per month in the winter and 22 therms per month in the summer, would see a net increase of about $9.50 a month on their total bill.
The cost of gas, or the supply rate, is set twice a year, is driven by the market cost of natural gas, and is not affected.
"This isn't about the market rate for natural gas," said Meara. "It's about the general operating cost of providing safe service to our customers."
He said the rate increase is needed to replace aging cast iron pipeline in some of the larger communities in the service area with "state of the art" high-density plastic piping.
Unitil provides natural gas service to 29,000 customers in the southeast corner of the state, from Rochester along to coast to Salem, including Newington, North Hampton, Dover, Plaistow, Portsmouth, Kensington, Hampton, Exeter and Greenland.
The line replacement would most likely occur in the oldest parts of the system, in Portsmouth and Dover, he said. Unitil has an operations facility in Portsmouth and corporate offices in Hampton.
The company, which is also a regulated electricity utility, acquired Northern Utilities in 2008 from Bay State Gas Company of Massachusetts.
If approved, the rate hike would generate an additional $5.2 million in base revenue for the company, or an increase of approximately 9.4 percent over current operating revenue.
This filing is subject to review by the Public Utilities Commission, and includes a request for temporary rates effective July 1. A final order on the filing isn't expected until mid-2014.