Upon completing Chattanooga Gas’ annual review mechanism (ARM), the Tennessee Public Utility Commission (TPUC) voted Monday to approve $6.8 million in rate adjustments in spent capital costs and recovery of costs for work completed in 2021.
The ruling, which gas officials said aligns with agreements made between Chattanooga Gas, the Tennessee Consumer Advocate, and the Chattanooga Regional Manufacturers Association (CRMA), allows the company to recover costs incurred in 2021 enhancing safety, improving reliability, and expanding its system to support growth in the Chattanooga region.
To minimize impact on customers’ bills, Chattanooga Gas is limiting the rate request based on the voluntary rate cap proposed by the company and approved by TPUC in 2021 for rate filings made in 2021 through 2024.
Under this voluntary rate cap, the 2022 rate increase to the typical residential customer’s total average bill is $4.20 a month or a 5.66 percent increase, officials said.
“As the Chattanooga area continues to grow, it's incredibly important we continue to make smart investments needed for our customers to have clean, safe, reliable and affordable natural gas,” said Pedro Cherry, president and CEO of Chattanooga Gas. “Working constructively with TPUC, we are committed to building infrastructure that will help ensure every customer, whether at home or running a business, has the natural gas they need to thrive. This agreement ensures we can continue to meet the region’s growing demand while maintaining safety, reliability and enhancing the customer experience.”
The work Chattanooga Gas completed in 2021 will ensure its ongoing ability to meet the supply and demand growth, especially during the coldest days of the year when customers rely on natural gas the most, it was stated.
The average Chattanooga Gas residential customer may expect to see an average total bill for the upcoming winter months as follows: December 2022 of $125.56 as compared to December 2021 of $100.74; January 2023 of $167.05 as compared to January 2022 of $133.47; and February 2023 of $158.54 as compared to February 2022 of $121.54. Current natural gas costs reflect the impact of supply constraints and higher demand. Chattanooga Gas does not profit from these increased costs and instead passes on the market cost directly to customers. The current per therm price customers pay for natural gas delivered by Chattanooga Gas comprises approximately 70% of a typical residential customer’s bill due to economic factors that have affected the commodity’s market price.