State regulators approve partial rollback of natural gas price increase

MidAmerican Energy’s 6% natural gas rate increase in South Dakota will be rolled back to 5.4%.

The over 100,000 South Dakotans who get natural gas from the company can expect the change to take effect in May. The rate change will affect commercial customers as well as residential.

MidAmerican proposed the 6% increase last May. The Public Utilities Commission and its staff had six months to investigate and make a decision before the company temporarily implemented the rate increase in November, but the three-member commission did not declare its decision in that timeframe. 

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The commission subsequently had another six months to make a retroactive decision, but meanwhile, the requested rate went into effect as an “interim rate hike.” That’s something the Public Utilities Commission describes as standard procedure.

“We do receive some criticism on, ‘Can’t you get this done within this period of time?’” Commissioner Gary Hanson said during Tuesday’s hearing. “People simply don’t appreciate the amount of work that goes into these.”

The reduced rate hike of 5.4% was reached through discussions among the company, PUC staff and a MidAmerican customer, Steve Wegman, whose standing as a formal intervenor in the rate case allowed him to participate in the process. Customers can expect refunds to make up for the extra portion of the higher temporary increase that’s already been collected.

Commissioner Kristie Fiegen said the rate hike is primarily due to safety investments in southeastern South Dakota, like replacing old steel infrastructure. 

Public Utilities Commission adviser Greg Rislov asked MidAmerican if the company is requesting a rate hike in other states. “The answer is no,” replied a MidAmerican spokesperson.

As part of the new rate-increase agreement, MidAmerican cannot request another rate adjustment for three years.