Kentucky Public Service Commission Approves Delta Natural Gas Company's Proposed Balancing Adjustment

Strategic Insights -

The Kentucky Public Service Commission has approved Delta Natural Gas Company's proposed balancing adjustment to true up its actual Pipe Replacement Program costs for the twelve months ending December 31, 2023, with its projected costs. The proposed effective date for the tariff with the revised rates is June 1, 2024. The Commission finds that Delta's proposed balancing adjustment is warranted and that the rider rates in Delta's proposed tariffs are fair, just and reasonable.

Key Takeaways:

  • The Commission approved Delta Natural Gas Company's proposed balancing adjustment to true up its actual Pipe Replacement Program costs for the twelve months ending December 31, 2023.
  • The proposed effective date for the tariff with the revised rates is June 1, 2024.
  • The Commission found that the rider rates in Delta's proposed tariffs are fair, just and reasonable.
  • The balancing adjustment true-up is an annual process, with Delta required to submit a balancing adjustment to true-up the actual costs with the projected costs by March 31 each year.
  • The decrease in the return on equity, grossed up for income taxes, is the result of a decrease of about $682,093 in the PRP rate base, as compared to estimated amounts used for the 2023 PRP year.
  • The increase in operating expenses is the result of a decrease in property taxes due to the decrease in actual plant in service over the estimate and an increase in depreciation expense.
  • The Commission ordered Delta to file revised tariff sheets setting out the rates approved herein and reflecting that they were approved pursuant to this Order within 20 days of the date of entry of this Order.

Statistics:

  • $50,018: the decrease in the revenue requirement proposed by Delta.
  • $(76,129): the decrease in the return on equity, grossed up for income taxes.
  • $2,611: the increase in operating expenses.
  • $682,093: the decrease in the PRP rate base.
  • 20 days: the timeframe for Delta to file revised tariff sheets setting out the rates approved herein.

Sources:

  • Order of the Public Service Commission in Case No. 2024-00078, dated May 31, 2024.
  • KRS 278.030(1).
  • KRS 278.509.
  • Case No. 2022-00341, Electronic Application of Delta Natural Gas Company, Inc., for Annual Pipe Replacement Program, dated August 11, 2022.
  • Case No. 2023-00343, Electronic Application of Delta Natural Gas Company, Inc., for Annual Pipe Replacement Program, dated December 22, 2023.