HOUSTON, Nov. 10, 2015 /PRNewswire/ -- CenterPoint Energy (NYSE:CNP) today filed an application with the Arkansas Public Service Commission (APSC) to change the company's natural gas distribution rates. The effect on individual monthly bills will vary depending on natural gas use. If approved, the net impact of the new rates will increase the average residential customer's bill by $6.68 per month.
"Our last increase in base rates went into effect approximately eight years ago; since that time, CenterPoint Energy has continued to make significant investments, such as our ongoing pipeline replacement programs, to maintain the safety and reliability of our natural gas system and benefit our customers and communities," said Walter Bryant, CenterPoint Energy's vice president of Gas Operations in Arkansas. "These capital investments, which are the primary reasons for this proposed increase, help ensure that we have a modernized, technologically advanced natural gas system that will continue to meet the needs of customers now and in the future."
This filing seeks approval to change the base rate portion of a customer's natural gas bill, which makes up about 60 percent of the total proposed average residential bill and covers the cost of distributing natural gas. The Company is also proposing a formula rate plan rider under the recently enacted provisions of Act 725 of 2015. This annual mechanism will help drive infrastructure investment and will reduce lag in the company's recovery of investments and expenses. It will also smooth out rate adjustments for customers by having smaller adjustments over time versus large adjustments from time to time.
The filing does not apply to the Gas Supply Rate (GSR), which makes up about 40 percent of the total proposed average residential bill and represents the cost of the natural gas that CenterPoint Energy buys to deliver to customers with no markup. Beginning this month, the company reduced the GSR portion billed to customers by about 19 percent for a residential gas bill using 100 Ccf (hundred cubic feet) of natural gas. This means a bill that was $109.12 in November 2014 will be $88.09 this month. Actual bills will vary depending on how much natural gas individual customers use.
If the filing is approved by the APSC, CenterPoint Energy expects the new rates would go into effect in the third quarter of 2016 and would generate approximately $35.6 million in additional revenue on an annual basis. The effect on individual monthly bills will vary depending on natural gas use and customer class.
CenterPoint Energy, Inc., headquartered in Houston, Texas, is a domestic energy delivery company that includes electric transmission & distribution, natural gas distribution and energy services operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. The company also owns a 55.4 percent limited partner interest in Enable Midstream Partners, a publicly traded master limited partnership it jointly controls with OGE Energy Corp., which owns, operates and develops natural gas and crude oil infrastructure assets. With more than 7,400 employees, CenterPoint Energy and its predecessor companies have been in business for more than 140 years. For more information, visit the website at www.CenterPointEnergy.com.
This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based upon assumptions of management which are believed to be reasonable at the time made and are subject to significant risks and uncertainties. Actual events and results may differ materially from those expressed or implied by these forward-looking statements. Any statements in this news release regarding future events, such as future regulatory actions on the APSC application, and any other statements that are not historical facts are forward-looking statements. Each forward-looking statement contained in this news release speaks only as of the date of this release.
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SOURCE CenterPoint Energy