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Intermountain Seeks First NatGas Base Rate Hike in 31 Years

North Dakota-based MDU Resources Group's Boise, ID-based Intermountain Gas Co. has filed its first request to increase base rates since 1985, seeking a $10.2 million (4%) annual increase.

The Idaho Public Utilities Commission (PUC) is accepting petitions for intervention through Sept. 23. Typically, intervenors represent various customer groups that present evidence and cross examine various utility and other witnesses. The PUC staff is now conducting a six-month investigation into the request.

Last month, Intermountain filed an application for the first base rate hike in 31 years, noting its residential customer base has increased from 85,400 to more than 300,000, while the commercial customer count has risen from 13,300 to nearly 32,000. The utility serves customers in 75 communities in southern Idaho.

"While more customers increase sales revenue, they also require more investment in non-revenue-generating infrastructure, such as pipeline expansion/replacement, and customer care systems and/or information technology," the utility told the PUC.

As part of the base rate request, Intermountain seeks a 9.9% return on equity based on a 7.42% rate of return.

Included in the base rate increase is a proposal to create demand-side management programs to help customers reduce gas consumption. One program would provide rebates to customers who install high-efficiency natural gas equipment and/or attain ENERGY Star certified homes.

Separately, the gas utility has a purchased gas cost adjustment (PGCA) to lower rates by an average of 7.1%, effective Oct. 1. The proposed base rate increase is slated to be effective March 1.

If the full base rate increase is approved by the three-member PUC, residential customers, on average, would see monthly bill increases of $2.31 (space and water heating) and $1.16 (space heating only), while commercial customers would see monthly hikes averaging a little more than $12. These increases do not take into consideration the monthly rate decreases that are coming if the Oct. 1 PGCA is approved by regulators.

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