MINNEAPOLIS (AP) — More than 800,000 natural gas users in Minnesota will pay more after CenterPoint Energy got permission for a temporary 4.9 percent rate increase, and the utility said more hikes will be needed in the future as it upgrades aging pipes.
State regulators approved the increase this week for CenterPoint, which has a slightly higher permanent request before the Public Utilities Commission. The temporary hike starts Oct. 1.
CenterPoint provides gas service in more than 260 Minnesota communities. The Houston-based utility said it will more than double its spending on distribution system upgrades to at least $140 million a year for up to 15 years. The company last pursued higher Minnesota rates in 2008.
"We believe there will be more rate hikes than in the past," Joseph Vortherms, CenterPoint's Minneapolis-based division vice president for regional operations, told the Star Tribune (http://bit.ly/19LnDQr ) on Thursday.
CenterPoint's infrastructure includes a vast, aging network of buried pipelines, much of it built from the 1940s through the 1960s as the nation's population boomed, Vortherms said. The company said more of that network needs attention and needs it quickly under federal safety guidelines requiring a systematic study of network risks.
As one example, the CenterPoint system includes 46 miles of cast-iron distribution pipes, most installed before 1930. It's the kind of pipe implicated in a 2011 gas explosion in Pennsylvania that killed five people.
Information from: Star Tribune, http://www.startribune.com