New Interim Rates Now in Effect
Approved Rates Start October 2, 2015
Interim rates were approved by the MPUC and set to begin Oct. 2, 2015. On August 3, 2015, CenterPoint Energy filed a request with the Minnesota Public Utilities Commission (MPUC) to change its rates for utility distribution service. State law permits CenterPoint Energy to charge interim (temporary) rates while the MPUC considers our request for new rates. The MPUC has approved an overall interim rate increase of $ 47.8 million, or 5.65 percent for all CenterPoint Energy customers. The increase is effective for service rendered on and after Oct 2, 2015. The MPUC will likely make its decision on our rate request in the summer of 2016. If final rates are lower than interim rates, we will refund customers the difference with interest. If final rates are higher than interim rates, we will not charge customers the difference.
We are making significant capital improvements in Minnesota in accordance with natural gas pipeline safety and integrity regulations. The expenses are necessary to:
- Recover CenterPoint Energy's significant capital expenditures in its Minnesota service areas including:
- Maintaining a safe and reliable system
- Responding to significant public improvement requirements on the system
- Modernizing the system with technology improvements
- Establish rates for all customers groups that better reflect the actual costs of providing service to our customers
- Achieve an overall revenue recovery level that meets the company's financial objectives.
The new rates will generate approximately $54 million or 5.65 percent in additional revenue on an annual basis. The effect on individual monthly bills will vary depending on natural gas use.
Customers' bills contain three basic parts: Basic Charge, Delivery Charge and Cost of Gas. The basic charges and Delivery Charges recover only the cost of providing utility distribution service to our customers. The rate case request does not apply to the cost of natural gas, which is the wholesale price the company pays for natural gas and makes up about 40 to 50 percent of the bill. The wholesale price of natural gas changes monthly depending on prices and is passed on directly to customers with no mark up.