PNG proposes sharing portion of tax benefits
PITTSBURGH — Peoples Natural Gas Co. has filed a petition with the Pennsylvania Public Utility Commission which proposes to share a portion of the benefits resulting from a change to income taxes Peoples incurs under the Internal Revenue Code.
Peoples has proposed to use 40 percent of the benefits from the change to provide an immediate rate reduction of approximately $14 million per year over four years, beginning Jan. 21, 2021.
The estimated 4.54 percent rate reduction will be applied to Peoples delivery rates charged to all customers. Customers using more or less than the average usage will see a larger or smaller change to their bills.
For example, the average residential customer, who uses 87,500 cubic feet of gas per month, should see a decrease of about $1.31 on his bill.
Peoples has proposed to defer the remaining 60 percent of the benefits from the tax change to income taxes to be used toward Peoples income tax expense from 2023 to 2025. Peoples projects that with the proposal, it may be able to avoid filing a general rate case that would result in increased base rates prior to Jan. 1, 2026.
Peoples has requested that the commission rule on the petition in sufficient time to implement the surcredit by Jan. 1.