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Alagasco Rate Review Begins in September; Dates for Hearings Released

Staff Report

Montgomery – On Tuesday, Alabama Public Service Commission President Twinkle Andress Cavanaugh announced that in September, the three-member regulatory panel will begin a new public rate review process for Alabama Gas Corporation, commonly known as Alagasco, and released the schedule for its information-gathering sessions.

Cavanaugh said, “After having successfully reviewed and reduced the rates for customers of Alabama Power and Mobile Gas companies, it is time we begin a thorough and balanced look at Alagasco…The members of the PSC will continue balancing what is fair to Alagasco with the need to provide some measure of relief to consumers during these difficult economic times. Our public rate review process has worked well twice before, and I am confident it will work smoothly during our inspection of Alagasco, as well.”

Cavanaugh said one of the meetings will be held outside of Montgomery in order to allow for a wide range of public participation. Previous public rate hearings for other utilities have been held in Tuscaloosa and Mobile.

The planned dates, topics and cities for the Alagasco public review process are:

September 5, 2013 in Montgomery – The commission will engage in a general overview of Alagasco operations and discuss elements of the natural gas business and its economics.

September 25, 2013 in Auburn – The commission will consider and discuss Alagasco-related topics that include pipeline safety, customer service, economic development and corporate risk. An evening session will be set aside specifically to gather public comment.

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October 9, 2013 in Montgomery – The commission will review the Rate Stabilization and Equalization formula for Alagasco, along with its finances and accounting. The RSE formula is used to determine the company’s allowed rate of return on its common equity.

Once the scheduled hearings have concluded, the commission and its staff will review the collected information, determine which rate adjustments are justified, and convene a public meeting of the full panel to vote on suggested changes.

Alagasco, which serves more than 420,000 customers, last saw its RSE formula adjusted in 1987.

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