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Washington Gas Light files to increase base rates by $56.3M

WGL Holdings Inc. utility Washington Gas Light Co. filed an application with the Maryland Public Service Commission to increase its natural gas service base rates and charges to account for infrastructure investments.

The utility expects to generate about an additional $41.3 million of annual revenue as a result of its proposed rates and charges, which includes a base rate increase of $56.3 million offset by $15 million in surcharges paid by customers for system upgrades and environmental improvement initiatives. If the request is approved, a typical residential heating customer will pay an additional $5.18 per month, representing an increase of about 7% on the total bill.

The new rates are scheduled to become effective in the December billing cycle, according to a May 15 news release.

Washington Gas had sought approval from the District of Columbia Public Service Commission to reduce gas distribution rates to reflect the impact of the federal tax overhaul, which lowered the federal corporate income tax rate to 21% from 35%. The rates became effective Feb. 1, resulting in an annual rate decrease of $14.8 million for Maryland customers.

Costs related to WGL's merger with AltaGas Ltd., which is expected to close in mid-2018, will not negatively impact customer rates, according to Washington Gas President and COO Adrian Chapman. AltaGas and WGL plan to return to customers the operational savings from the merger, which are expected to amount to $800,000 per year for five years.