HARRISBURG – The Pennsylvania Public Utility Commission (PUC) Wednesday approved a proposal submitted by National Fuel Gas Distribution Corporation (NFG) to reduce rates and provide refunds to customers to return excess funds that were collected to cover various benefits for retired NFG employees.

The Commission voted 4-0 today to approve NFG’s plan regarding what is known as Other Post Employment Benefits (OPEB), including health care and other non-pension benefits for retirees.

In NFG’s petition to the PUC, the utility explains that OPEB obligations have not increased significantly since their last rate case, in 2006, and the market performance for the investment fund supporting OPEB payments has been strong. Since future OPEB expenses can be met with existing funds, NFG proposed ending the collection of OPEB expenses and returning excess funds to customers.

The plan approved by the PUC will reduce the utility’s base rates by $7.7 million – effective on Oct. 1, 2021 – stopping the collection of OPEB expenses from customers which are no longer needed to cover future costs. According to NFG’s calculations, the average residential customer using 100.3 Mcf of natural gas per year will see an annual distribution rate reduction of $52.56 (approximate 6.31% of their total bill, based on current gas costs).

Additionally, NFG will refund $50 million that has already been collected but is not needed for future OPEB costs. $25 million will be refunded through a one-time bill credit for all customers (for residential customers, the credit will be $100). The remaining $25 million will be refunded over the next five years as a monthly credit on consumer bills (totaling $5 million per year).

NFG serves nearly 214,000 customers in 14 counties across northwestern Pennsylvania.