The state Public Utilities Regulatory Authority began hearings Tuesday on plans from the state’s three natural gas distributors to add 280,000 new customers.
There are eight more hearings scheduled through Oct. 3 on a joint proposal by Connecticut Natural Gas (CNG), Southern Connecticut Gas (SCG) and Yankee Gas to increase rates to cover the costs of the new commercial and residential gas hookups over the next decade.
Gov. Dannel Malloy’s administration called for the oil-to-gas conversions in its so-called comprehensive energy strategy, finalized in February.
The goals of the plan are to reduce costs for ratepayers, ensure the reliability and safety of the state’s energy supply, increasing the use of clean energy and related technologies and to develop the state’s energy economy.
The utilities plan to fund incentives and credits to spur ratepayers to switch to gas, something that has rankled heating oil and propane distributors.
About a third of Connecticut homes have gas heat, compared to a national average of 58 percent. State officials argue that the lower price of natural gas justifies the incentives for conversions.
SCG and CNG, which are owned by UIL Holdings Corp., said they aim to add 197,600 new customers to their existing base of 338,000 in 44 communities. Yankee Gas wants to add 82,400 customers to its existing 214,000 customers in 71 towns.
The UIL distributors have disclosed that they anticipate their capital budgets to triple to $120 million over 10 years, while Yankee has said it expects capital expenditures to jump from $35.2 million in 2014 to $43.2 million 2015 and $53 million in 2016.
The state Office of Consumer Counsel has estimated that the plan would lead to delivery rate increases of up to 3 percent per year plus addition system expansion rate increases.
