MINNEAPOLIS, Oct. 28, 2019 /PRNewswire/ -- CenterPoint Energy
(NYSE: CNP) today filed an application with the Minnesota Public
Utilities Commission (MPUC) requesting an adjustment to
distribution charges for the company's natural gas business in
Minnesota.
The proposed rate adjustment would support major investments in
the continued safety and reliability of the approximately
14,000-mile pipeline system that serves more than 860,000
CenterPoint Energy customers in Minnesota.
Specifically, if the rate adjustment is approved, it would help
cover the rising costs of infrastructure projects to replace or
upgrade pipelines to prevent leaks and comply with more stringent
federal pipeline regulations. It would also help cover costs
related to a growing number of local road construction and other
public works projects that require CenterPoint Energy to relocate
pipelines and equipment. Current rates do not provide adequate
revenue to cover these increased costs.
"Our customers and communities benefit from the essential
investments we make to ensure the safety and reliability of our
natural gas distribution system," said Brad
Tutunjian, vice president of the Minnesota region for CenterPoint Energy. "For
example, we are modernizing our infrastructure and replacing many
existing pipelines with even more resilient materials that will
maximize safety."
Tutunjian added: "About 80 percent of the homes in our
Minnesota service area depend on
natural gas for heat. As another winter heating season arrives,
CenterPoint Energy is committed to delivering reliable,
affordable clean energy that is available around the clock, even on
the coldest days, to keep Minnesotans safe and warm."
With the proposed adjustment, the average residential customer
bill would increase by about $4.80
per month. Currently, the average residential customer pays about
$55 per month for natural gas
service, with most of these costs incurred during the winter
heating season.
Even with the proposed adjustment, monthly bills for the average
CenterPoint Energy residential customer in Minnesota would still be nearly 35 percent
lower than a decade ago, due to a decline in natural gas prices
partially offset by increases in delivery rates.
Since 2013, CenterPoint Energy has invested more than
$1 billion in its network of natural
gas pipelines and equipment serving Minnesota customers. The company expects to
invest an additional $1 billion over
the next five years. These increased investments reflect an
industry-wide trend, partly in response to federal pipeline
regulations. If approved, the proposed new rates would result in a
revenue increase of about $62 million
annually, or 6.8 percent.
Major CenterPoint Energy projects in Minnesota include:
- Inspecting, upgrading and replacing transmission and
distribution pipelines as part of a comprehensive integrity program
to address pipes at risk of corrosion or leaks;
- Replacing all 43 miles of cast iron pipelines in CenterPoint
Energy's Minnesota system, a
project that was completed in 2017, eliminating a pipe material
that contributed to methane emissions;
- Replacing or upgrading 479 miles of unprotected or bare steel
distribution pipelines;
- Replacing 61 miles of a high-pressure, large-diameter
transmission pipeline (known as the Metro Belt Line Project),
originally installed in the 1940s and 1950s;
- Replacing nearly 15,000 copper service lines;
- Replacing and moving outside more than 89,000 indoor
residential meters, with new service lines, as a safety measure to
provide direct access to shut-off valves; and
- Deploying state-of-the-art technology to quickly and
efficiently detect even the smallest leaks, which supports both
safety and methane reduction.
In addition to improved safety and reliability, these
investments help protect the environment and prevent greenhouse gas
emissions. For example, permanent replacement of all cast iron and
many bare steel pipelines and the use of advanced leak detection
technology have already resulted in an 18 percent reduction in
methane emissions from the company's Minnesota operations since 2013.
CenterPoint Energy's request seeks approval to change the basic
and delivery charges on a customer's bill, which together make up
about half of the total bill and cover the costs of distributing
natural gas, including operations, maintenance, taxes and other
expenses. The proposed changes would affect individual monthly
bills differently, depending on natural gas use and customer
type.
The request does not apply to the cost of natural gas, which
makes up the other half of a typical customer bill. The wholesale
price of natural gas changes monthly depending on market prices.
This price is passed on directly to customers with no mark-up, and
CenterPoint Energy does not profit from the sale of the natural
gas.
The Public Utilities Commission will likely decide on the
requested rate adjustment in late 2020 or early 2021. In the
meantime, the Commission will set temporary rates on an interim
basis, which would take effect on Jan. 1,
2020, and remain in place until a final decision is made.
The requested interim rate increase is about 5.8 percent more than
the current rate.
If the final approved rates are lower than the interim rates,
CenterPoint Energy would refund customers the difference, including
interest. If the final approved rates are higher than the interim
rates, customers would not be charged the difference.
Public hearings will be held early next year to provide
customers and other interested parties the opportunity to comment
on the rate request, followed by formal hearings at the Public
Utilities Commission.
Customers with questions about the proposed change to natural
gas distribution rates can call CenterPoint Energy at 612-372-4727
or toll-free 800-245-2377, or visit the company's website at
CenterPointEnergy.com/RateCase.
About CenterPoint Energy
Headquartered in Houston, Texas,
CenterPoint Energy, Inc. is an energy delivery company with
regulated utility businesses in eight states and a competitive
energy businesses footprint in nearly 40 states. Through its
electric transmission & distribution, power generation and
natural gas distribution businesses, the company serves more than 7
million metered customers in Arkansas, Indiana, Louisiana, Minnesota, Mississippi, Ohio, Oklahoma and Texas. CenterPoint Energy's competitive energy
businesses include natural gas marketing and energy-related
services; energy efficiency, sustainability and infrastructure
modernization solutions; and construction and repair services for
pipeline systems, primarily natural gas. The company also owns 53.8
percent of the common units representing limited partner interests
in Enable Midstream Partners, LP, a publicly traded master limited
partnership that owns, operates and develops strategically located
natural gas and crude oil infrastructure assets. With approximately
14,000 employees and nearly $34
billion in assets, CenterPoint Energy and its predecessor
companies have been in business for more than 150 years. For more
information, visit CenterPointEnergy.com.
This news release includes forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. When used in this news release, the words "would,"
"estimate," "expect," "may," "will" or other similar words are
intended to identify forward-looking statements. These
forward-looking statements are based upon assumptions of management
which are believed to be reasonable at the time made and are
subject to significant risks and uncertainties. Actual events and
results may differ materially from those expressed or implied by
these forward-looking statements. Any statements in this news
release regarding future events, such as future legislative and
regulatory filings, actions and decisions, including the timing and
impact of such actions and decisions, the amount and timing of, and
expected benefits derived from, proposed investments, the impact of
the proposed rate adjustments on costs of various projects, the
expected impact of the proposed rate adjustments on customer bills,
the performance and expected benefits of various projects,
including relating to emissions reductions, expected actions in
response to temporary and final approved rate changes, the
projected impact to customers and any other statements that are not
historical facts are forward-looking statements. Each
forward-looking statement contained in this news release speaks
only as of the date of this release. Factors that could affect
actual results include timing and impact of future regulatory and
legislative decisions, general economic conditions, effects of
competition, weather variations, changes in business plans,
financial market conditions and other factors discussed in
CenterPoint Energy's Annual Report on Form 10-K for the fiscal year
ended December 31, 2018 and other
reports CenterPoint Energy or its subsidiaries may file from time
to time with the Securities and Exchange Commission.
For more information, contact
Communications
Ross Corson: 612.321.4879
Media.Relations@CenterPointEnergy.com
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SOURCE CenterPoint Energy, Inc.