The Missouri Public Service Commission late Thursday unanimously approved an overall settlement on a natural gas rate case filed last January by Laclede Gas Co., the largest natural gas distributor in the state. The new gas service rates approved will increase a typical residential customer’s average monthly gas bill by approximately $1.76 a month.

The agreement includes new rates designed to improve the company’s recovery of its distribution by $14 million annually; a moratorium on additional rate filings through March 1, 2004; and an innovative system of rate design that should mitigate the impact of weather volatility. The settlement also is expected to stabilize Laclede Gas’ revenue flow without changing the overall rates paid by its 630,000 customers in St. Louis and surrounding eastern Missouri counties. The rate decision does not impact the cost to obtain natural gas, which typically represents about two-thirds of a customer’s bill, said Laclede Gas, which is a subsidiary of The Laclede Group.

The new rate design provides Laclede with the ability to recover its distribution costs, which are essentially fixed, in a way that is significantly less sensitive to weather. In a colder-than-normal winter, when bills are likely to be higher because of increased customer usage, Laclede’s customers will not be charged more than the company’s actual distribution costs. Conversely, in a warmer-than-normal winter, when bills are likely to be lower, the rate structure will prevent any significant weather-related under-recovery of these actual distribution costs.

©Copyright 2002 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.