MDU natural gas customers will soon see an increase on their monthly bills.
The Public Service Commission has approved an interim increase in natural gas rates. MDU had filed for increased revenues of $5.5 million -- a 5.4 percent rate increase. The PSC suspended that. But state law allows a utility to have an interim increase.
"The interim increase is $4.6 million, an overall increase of 4.2 percent," said Commissioner Brian Kroshus. "The monthly increase for a residential customer is approximately $2.44."
Kroshus said if the PSC approves the full rate increase, the customer’s bill would go up $2.98 per month. But if the PSC decides the final rate will be lower than the interim rates, MDU will be required to give a refund.
"Essentially, this is for capital investment and pipeline replacement projects," Kroshus said. "It's to enhance the safety and integrity of the natural gas system. A portion would also go to operational costs."
Commissioner Julie Fedorchak said this new “system safety and integrity” program is a nationwide effort.
"While customers hate to see a rate increase, it's really important the system in place is as safe as possible," Fedorchak said. "We don't want any of the accidents or explosions that have happened in other parts of the country."
The PSC will hold formal hearings on the rate case later.