Dominion Transmission Inc. (DTI) will roll back its customer rates by $245 million over the next five years under a settlement agreement approved by FERC last week. The rollback applies to users of the pipeline in Maryland, New York, Ohio, Pennsylvania, Virginia and West Virginia.
The settlement (Docket No. RP05-267-000) was jointly sponsored by DTI and the Public Service Commission of New York (PSC). It calls for DTI to reduce its firm transportation reservation rates by more than 16% and its storage fuel retention rate by more than 17%.
The approved rate reductions will produce total systemwide savings to DTI's customers of about $49 million annually over a five-year period during which DTI must maintain the agreed-upon rates.
The settlement is the result of PSC staff's analysis of financial and operating data filed by DTI at the Federal Energy Regulatory Commission in 2004. The settlement process was initiated in late 2004 when the PSC notified DTI of its intent to file an over-earnings complaint with FERC based on the analysis. DTI and the PSC negotiated the settlement to avoid the possibility of costly and protracted litigation. It also will provide customers with immediate rate relief and rate stability and provide DTI with revenue certainty.
In New York, annual savings are expected to be $11 million. For other states, Dominion spokesman Bob Fulton said it would be "difficult to determine at this time what impact the agreement will have on residential, industrial and commercial customers.".
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