Washington Gas Light Co. Friday filed an application with the Maryland Public Service Commission (PSC) to increase its rates and charges to better reflect its costs.

"The existing rates no longer reflect our costs of providing utility service in Maryland," said Washington Gas CEO James H. DeGraffenreidt Jr.

Washington Gas, which provides natural gas delivery services and retail sales to Maryland customers, is a regulated utility, and its rates and charges must be approved by the Maryland PSC.

In the four years since its last rate increase, Washington Gas has weathered several factors that have increased business costs substantially, the company said. These factors include new investments in infrastructure, general inflation, rising labor and employee benefits costs, higher insurance costs and additional compliance-related expenses for new laws such as the Pipeline Safety Improvement Act.

The proposed rates and charges will increase Washington Gas's overall annual Maryland revenues by $33.8 million, an increase of 4.4%. The typical residential heating customer would see an increase of about 5.62% in his gas bill, or an average of about $5.70 per month.

Washington Gas also is seeking approval for a performance-based rate (PBR) plan, which would allow the company to share the benefits of any future efficiency improvements and cost reductions with both investors and customers. With the approval of the proposed PBR plan, Washington Gas would agree not to request a base rate increase for three years.

Washington Gas proposes the new rates and PBR Plan be implemented in November. About 421,000 of the company's one million customers live in Maryland.

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