Utility Will Lower Rates Charged Since February
By Zachary A. Goldfarb
Washington Post Staff Writer
Monday, September 24, 2007
Washington Gas Light is set to issue refunds to its residential and commercial gas customers in Virginia after agreeing to lower the rates it has been charging since February, the company said last week.
The Virginia State Corporation Commission, which oversees utility rates in the state, said the average refund for residential customers would be $16.50. Washington Gas Light would not confirm that figure.
WGL, which supplies natural gas to 439,000 residences and 27,000 commercial and industrial customers in Virginia, said credits would be issued this fall.
In addition, under an agreement with the state, Washington Gas will for the first time be allowed to add a surcharge -- or credit -- to a customer's bill to reflect unusual weather patterns. The change is intended to smooth out big swings between bills and create more-predictable revenue for the company.
As a result, customers could see rates increase during an unusually warm year, when demand for gas would be lower, or vice versa in an unusually cold year.
The agreement comes after an initial proposal by Washington Gas to raise rates generated concerns among Fairfax and Prince William county officials, the Apartment and Office Building Association of Metropolitan Washington, residents, and others.
Last September, WGL asked to raise its rates for delivering gas by 3.6 percent for residences and 1.3 percent for commercial and industrial customers. The delivery of gas accounts for 35 percent of a gas bill. The company was allowed to put the new rates in place in February but was required to issue refunds if the state decided they were excessive.
WGL originally estimated that the increase would cost residences about $45 annually, with an outsize portion coming during the winter months. At the time, WGL said it needed to boost its revenue to offset inflation, rising labor and employee costs, and accounting demands.
The WGL agreed to scale back the amount it needed to raise to $3.9 million. The new rates are frozen for four years under the agreement.
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