The Public Utility Commission Wednesday approved a settlement for a new five-year pilot program that changes the method of payment for customers of Peoples Natural Gas Company LLC and Peoples Natural Gas Company LLC – Equitable Division seeking gas line extension projects.

The Commission voted 5-0 to approve the “Rate MLX” program in the Peoples and Peoples-Equitable service territories, replacing the companies’ existing Service Expansion Program (Rider SET). 

While Rider SET allowed customers to pay a fixed $55 monthly fee to extend gas service, the new Rate MLX provides for a higher delivery rate for customers to pay for system expansion costs. 

The companies claimed that customers were more receptive to paying for their share of pipeline expansion costs through higher delivery charges.

The MLX delivery rates will be based on a nine-tiered delivery rate structure, set by the companies for each project area based on the minimum delivery rate required to cover project costs. 

The settlement includes important customer protections to ensure that participating customers are not overcharged, including provisions allowing Rate MLX customers to be moved to a lower rate MLX tier if the current tier is deemed too high, and ensuring Rate MLX is discontinued when project costs have been recouped. 

Projects will be examined periodically to determine whether the MLX delivery rates should be adjusted.

Under most natural gas company tariffs, a customer who wishes to have natural gas service extended to their property must pay up-front the cost of that line extension, which can run in the thousands of dollars.

In this case, the Joint Petition for Settlement was reached among Peoples; Peoples-Equitable; the PUC’s independent Bureau of Investigation and Enforcement; the Office of Consumer Advocate; and the Office of Small Business Advocate.

Docket No.: R-2016-2542918 and  R-2016-2542923

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