The rates charged to customers of Columbia Gas of Virginia for delivery service will be frozen for four years under a performance-based rate (PBR) plan authorized by the State Corporation Commission (SCC). The new rate plan takes effect Jan. 1 and includes a $2 million credit back to residential and commercial customers in 2007 and again in 2008.

Columbia filed its application for the PBR plan on Nov. 2, 2005. In combination with Columbia’s submission, the SCC initiated an investigation into the justness and reasonableness of Columbia’s current rates, fees, charges, and terms and conditions of service. These nongas components represent 35% of an average customer bill. The rest of the bill represents the cost of gas used by the customer.

During the course of the proceeding, a proposed settlement on the provisions of the PBR plan was offered by Columbia, the SCC staff, the Office of the Attorney General, Fairfax County, three interstate pipeline companies serving Virginia, two natural gas marketers, two industrial customers and the Virginia Industrial Gas Users’ Association.

The commission approved the terms of that settlement. The major elements of Columbia’s PBR plan include:

In its final order, the commission said, “Consistent with the statutory requirements for a performance based regulatory plan, we expect Columbia’s service and reliability to remain at or to exceed present levels during the term of the amended PBR plan.”

Columbia serves 230,000 customers in northern Virginia, Hampton Roads, central Virginia, the Shenandoah Valley, the Lynchburg region and parts of western Virginia.

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