Current Tariff
The Maryland Public Service Commission (PSC) approves rules and regulations that govern operations and rates of Columbia Gas of Maryland.
See our Tariff for our rules and regulations.
2023 Rate Adjustment Approval Common Questions
On October 26, 2023, the Maryland Public Service Commission’s (PSC) final order in Columbia Gas of Maryland’s 2023 Rate Case, originally filed on May 12, 2023, became effective. The rate case supports the Company’s continued and significant improvements to its natural gas distribution system. The base rate adjustment approval allows an increase in annual revenues of approximately $5.2 million. The new rates apply to bills rendered on or after December 8, 2023.
What is a base rate case?
Columbia Gas sought approval from the PSC to adjust the system charge and distribution usage charges, which are commonly referred to as base rates.
Unlike most companies, which can change the price of their product/service without outside approval, regulated energy providers—like Columbia Gas—must submit a detailed request to change their base rates to its regulator, the Maryland Public Service Commission (PSC). The request includes evidence to support the increase and demonstrate how it benefits customers.
The process—referred to as a rate case—must be decided by the PSC.
Customers had the opportunity to participate in the review process in multiple ways, including through written comments or by attending virtual public hearings. Residential customers were represented throughout the process by the Maryland Office of People's Counsel.
The rate case review is public. All of the documents that were part of this rate case can be found on the PSC’s website under Case No. 9701.
Thank you for your response.
What are base rates?
Base rates generate the revenue needed to recover the costs to repair, upgrade, and operate Columbia Gas of Maryland’s natural gas delivery system. This system includes 669 miles of pipelines, regulator stations, meters, and other facilities. This charge is separate from natural gas costs, which generally make up about a third of the total bill. As a regulated utility, Columbia Gas purchases gas on the wholesale market and, under Maryland law, passes those natural gas costs on to its customers without mark-up or profit.
Base rates are made up of a system charge and a usage-based distribution charge (per therm rate).
- The system charge is a flat rate customers pay on each bill regardless of how much gas Columbia Gas delivers to their home or business.
- The distribution usage charge is based on how much gas Columbia Gas delivers to their home or business.
The system charge and the distribution usage charge are the only source of revenue for the recovery of Columbia Gas’ operating costs. All of Columbia Gas’s investments in pipes, meters, and all of its expenses that support safe and reliable gas service – including responding to gas-related emergencies – are recovered through the system charge and distribution usage charge.
The Gas Commodity Charge, which is separate from base rate charges, recovers the cost of the natural gas used by a customer. Natural gas costs, which make up about a third of the total bill, are passed through to customers on a dollar-for-dollar basis. Under Maryland law, utilities cannot profit on the gas commodity charge.
Thank you for your response.
Why does Columbia Gas need to adjust its rates?
To continue to provide safe, affordable and reliable natural gas service, we must invest in our system to upgrade aging infrastructure, just as investments are made in bridges, roads and other infrastructure in our cities, towns and communities.
From 2008 through 2022, Columbia Gas invested nearly $266 million in the modernization and expansion of its distribution system in Maryland. Of that amount, approximately $206 million was dedicated to replacing nearly 111 miles of aging bare steel and cast iron pipe.
In 2023, Columbia Gas plans to invest more than $39.6 million in Maryland, with $32.6 million being invested to upgrade aging underground infrastructure.
This filing is needed to pay for the Company’s significant investment in Maryland.
Thank you for your response.
What do you mean by aging infrastructure? Are we safe?
Yes, our system is safe, as evidenced by our ability to address leaks appropriately, as well as through other operational improvements including more frequent leakage surveys and better emergency leak response. Additionally, all known cast iron pipe in our Maryland system was eliminated by the end of 2020. However, we must be a prudent operator and address the systemic replacement of our unprotected bare steel facilities.
After decades of providing service to our parents and grandparents, some of our pipes must be replaced to ensure continued safe and reliable service. These pipelines served us well, but it has come to the point where it is more cost effective for us to replace the pipe now, rather than repair the pipe only to replace it in the near future.
Thank you for your response.
What does this mean for my bill?
Under the new rates applied to bills rendered on or after December 8, 2023, the total bill for an average residential customer who purchases 60 therms of gas per month from Columbia Gas will increase from $100.52 to $108.67, or by 8.11 percent.
Even with this rate adjustment, the average total bill for a residential customer will still be about nine percent lower than it was 20 years ago, when adjusted for inflation.
Thank you for your response.
Is this rate increase fair to Columbia Gas customers?
Columbia Gas views this as a fair and reasonable adjustment of rates for the significant investment in Maryland. The increase is the result of a settlement among Columbia Gas, Commission Staff, and the Maryland Office of People’s Counsel, which the PSC has approved. Our continued investment enhances the safety and reliability of our natural gas delivery system.
Thank you for your response.
When will this adjustment impact my bill?
Thank you for your response.
Doesn’t Columbia Gas already adjust my rates every quarter?
Yes, but the Company does not adjust base rates every quarter. Every quarter, we file our quarterly gas cost adjustment for the natural gas commodity portion of your bill. Natural gas costs represent about a third of your total bill. We purchase our gas on the wholesale market and, under Maryland law, pass those costs on to our customers without mark-up or profit.
Thank you for your response.
When was the last time Columbia Gas asked to adjust its rates?
Columbia Gas last filed for a rate adjustment in May 2022. The proposed rates were implemented for service beginning December 9, 2022.
Thank you for your response.
Why are you increasing rates while inflation and higher costs are affecting Maryland residents?
Safety is Columbia Gas’s number one priority, and we are committed to our continued investment in the safest possible natural gas delivery system for our customers and communities.
Columbia Gas is investing $32.6 million to replace aging pipe in Maryland in 2023 alone. This rate adjust provides for a reasonable return for this investment in replacing and upgrading our natural gas distribution system.
Overall, consumers are currently dealing with rising prices on everything from gasoline to groceries. It is evident that the costs for everyday essentials have been steeply on the rise across the nation. A similar trend can be seen in the energy markets, which is expected to result in continued higher prices for natural gas this heating season.
Natural gas costs are passed through to customers on a dollar-for-dollar basis and under Maryland law, utilities cannot profit on the gas commodity charge. If our customers are experiencing financial challenges, Columbia Gas has very specific programs to help customers manage their energy bills to stay safe and warm in their homes.
There are a range of options and tools available to help customers with their bills, and we encourage them to contact us to help identify the assistance that may best meet their needs. Customers can visit www.ColumbiaGasMD.com/assistance to learn more about our programs.
Thank you for your response.
What are the customer benefits in this rate request?
Infrastructure Upgrades. We are enhancing the safety of our system through our pipeline replacement program. We will continue to invest millions of dollars each year to replace aging distribution pipelines. We remain committed to providing safe, reliable, and efficient natural gas distribution service, and we plan to dedicate more than $32.6 million in 2023 just to replace aging infrastructure.
System Reliability. Upgrades to the system with plastic and cathodically protected steel pipe not only maintain safety, but also provide an upgraded system design ensuring more reliable service during extreme cold temperatures. The new system also provides more flexibility in adding new, high efficiency equipment and allows for the installation of smaller, less expensive interior piping system for customers.
Pipeline Maintenance Enhancements. System maintenance practices will further improve the safe and reliable delivery of natural gas, such as enhanced training and system improvements to reduce the amount of damage done to our distribution facilities by external parties, the number one risk to the safety of our system.
Job Creation. Our pipeline replacement program is adding jobs, both full-time employees (engineers, engineering technicians, land agents and construction inspectors) as well as contractors who perform the actual pipe replacement (including laborers, equipment operators, crew leaders and support staff), and associated support services such as paving, traffic control, trucking, sand and gravel and a myriad of other material purchases and support activities.
We take our commitment to our local communities seriously, and we are proud of the nearly 65 full-time employees and over 100 contractors across the state of Maryland who comprise the Columbia Gas team.
Thank you for your response.
How is Columbia Gas trying to reduce costs for customers?
Columbia Gas continues to focus on working efficiently. We have taken the following steps to save money and will continue to look for additional ways to make the most cost-effective decisions for our customers:
- Technological investments, such as investing in Automated Meter Reading technology, to reduce the costs associated with reading meters manually.
- Long-term contracts with our pipeline contractors, which ensure affordable and predictable rates for their services.
- Partnerships with our sister gas distribution companies in Ohio, Pennsylvania, Kentucky, and Virginia, as well as our parent company NiSource, to save money through consolidated, in-house services as well as to gain economies of scale through the ordering of supplies, materials, and contractors.
Our approach is working. The average total bill for a residential customer will still be about nine percent lower than it was 20 years ago, when adjusted for inflation.
Thank you for your response.
What about customers who have trouble paying their bills?
The Maryland PSC determines what Columbia Gas’s rates will be. The decision to ask the PSC to approve a rate adjustment was not made lightly. We have a responsibility to continue the safe and reliable operation of our system, and that includes assessing the financial need to support our critical infrastructure replacement program and identify additional system risks while maintaining the safe operations of our system across our entire service area.
At all times, Columbia Gas is committed to providing our low-income customers with the tools, resources, and programs to stay safe and warm in their homes. These programs help customers mitigate the impact of a rate adjustment or financial changes due to economic conditions.
Budget Payment Plan: Available to all Columbia Gas customers, the Budget Payment Plan allows customers to spread yearly bills over twelve months instead of paying your account balance each month, helping to eliminate high winter bills. The budget season starts in May, but customers may sign up at any time.
Maryland Energy Assistance Program (MEAP): Columbia Gas serves as a link to federal energy assistance funds which provide help with residential heating costs. These energy grants do not have to be repaid by the customer. Enrollment guidelines, which are revised each new heating season, are based on household size and income. MEAP applications are accepted year-round.
Utility Service Protection Program (USPP): USPP protects families with low incomes from utility cut-offs and allows MEAP eligible households to enter into a monthly payment program to help stabilize energy bills. MEAP grants are deducted from the estimated annual utility bills, lowering monthly budget payments. For households with back bills, special agreements with Columbia Gas are available to arrange for payment on the balance.
Heat Share: The Columbia Gas of Maryland Fuel Fund provides energy grants to customers with low incomes for use in offsetting arrears or restoring service to terminated accounts. Heat Share funds are only available to customers who have exhausted all other available energy assistance programs.
Low Income Usage Reduction Program (LIURP): This weatherization program helps to reduce bills by sealing areas where heat escapes. It assists income-eligible customers who have high gas usage reduce how much energy they use.
Thank you for your response.
Doesn’t Columbia Gas include an Infrastructure Replacement and Improvement Surcharge (IRIS) under STRIDE? Why is Columbia Gas asking for this increase along with the IRIS surcharge?
The STRIDE mechanism allows Columbia Gas to recover a portion of its costs of replacing aging infrastructure through a monthly surcharge on customers’ bills. By law, however, the STRIDE surcharges are capped, and specifically the residential STRIDE surcharge is capped at $2 per month. Columbia Gas’s current level of investment in qualifying facilities exceeds that amount.
It is therefore necessary to move investments out of the STRIDE surcharge and into base rates in order to allow continued funding of Columbia Gas’s ongoing infrastructure replacements. The law includes protections to assure that there is no double recovery.
Additionally, the STRIDE surcharge covers only investments in facilities, and not operation and maintenance costs. It is therefore also necessary to adjust base rates to allow Columbia Gas to recover its increased O&M costs.
Thank you for your response.
In Maryland, state legislators have introduced bills that would limit or eliminate natural gas in the future to help reduce greenhouse gas emissions, so why would Columbia Gas want to invest in its natural gas system in the state?
Columbia Gas believes that the natural gas infrastructure will play an important role in our energy future and in helping to achieve decarbonization goals. The infrastructure that delivers traditional natural gas is already beginning to transport other types of fuels, such as renewable natural gas, hydrogen, or other low-carbon fuels.
Renewable natural gas is uniquely positioned to provide a meaningful contribution to decarbonization today and in the future due to its dual benefits. Renewable natural gas not only can serve as a substitute for conventional fossil fuels but can also offset emissions from other sources, such as landfills and livestock operations. Methane that would normally be released into the atmosphere at these locations is instead captured leading to an even greater carbon reduction.
Thank you for your response.