National Grid customers may see an increase in future natural gas bills.
The utility’s gas distribution companies, Colonial Gas and Boston Gas, are seeking approval from the state Department of Public Utilities to raise more than $138 million by hiking rates an average of 6.2% for residential users and 13.4% for industrial. The rate hike will go towards paying more for upgrades to the utility’s aging natural gas system.
This is the first gas rate increase sought by the company since 2017; Gas distribution rates have remained unchanged since then.
In a recent message to customers, National Grid said that “These additional revenues will support operation and maintenance costs and capital costs associated with investments in the gas distribution system while ensuring the safety and reliability of all services.”
State regulators held a virtual public hearing on the proposal Tuesday night, where they outlined the company’s request and heard from company executives and customers.
Under the proposed increases, residential customers would see annual bills grow $16.55 on average, depending on how much gas someone uses and whether it’s for heat, hot water, or other uses, according to the utility’s reports to the state. Commercial and industrial users would see increases of $122.49, depending on their systems.
“I understand that there is never an ideal time to raise rates and we are always mindful of the impact that rate increases have on our customers,” National Grid Massachusetts President Marcy Reed said during Tuesday’s hearing. “However, I am confident that the request … is necessary to maintain the level of service our customers expect.”
Other utilities are also increasingly seeking revenue to pay for projects to modernize aging gas infrastructure, such as fixing leaks, replacing pipes, and upgrading systems. Under state law, they can pass those costs onto consumers.
Eversource received approval from state regulators in November 2017 to raise electricity rates by nearly $220 million over five years, including a $37 million increase in the first year. It has 1.4 million customers in the state.
If approved, the increases would go into effect on Oct. 1, 2021.