Churches and other nonprofits argue that a mandatory natural gas charge they’re paying is taxing their budgets.
Now, at the direction of state lawmakers, the Public Utilities Regulatory Authority (PURA) is investigating the situation.
PURA will prepare a report for lawmakers over the coming seven months, with recommendations about what natural gas costs tax-exempt nonprofits should be required to shoulder.
Specifically at issue is a so-called “demand charge” paid by industrial and commercial gas customers, which, for at least one Suffield church, added up to $6,500 in a recent year.
The charge, which is separate from the typical volume-based charges gas customers pay, is calculated based on the day of the week that a customer uses the most gas. It’s billed monthly, even during the summer, when most properties have the heat off.
The idea is that the demand charges pay for utility infrastructure needed to prepare for peak energy demand periods, according to the Office of Consumer Counsel.
However, houses of worship, in particular, argue it’s unfair, and have been pressing PURA since 2017 about the matter.
Earlier this year, churches and religious organization officials told lawmakers that they aren’t commercial operations that earn a profit, like other entities that pay the demand charge, and argued that their peak gas use, primarily on weekends, doesn’t significantly impact utility demand.
They wanted an exemption, but lawmakers didn’t go that far. Ultimately they ordered the PURA study, which will include a broader array of nonprofits, not just churches.
