PORTLAND, Maine — The office of the state’s utilities watchdog has asked Maine’s top court to invalidate natural gas rates approved for Bangor Gas Co., seeking use of a different rate-setting method for residential customers and new ratemaking processes for industrial customers such as Verso Paper’s Bucksport mill.
Regulators earlier this month approved a plan to continue Bangor Gas’ current rate plan for another seven years, which they determined would continue to support natural gas expansion in the company’s service area.
The Maine Office of the Public Advocate argued in its appeal filed Monday to the Maine Supreme Judicial Court that the Maine Public Utilities Commission erred in the way it approved the rate plan, which the public advocate said should have followed four different ratemaking steps set out in state law. That process calls for the rates to be based on revenue requirements, a method that regulators said it found would lead to higher costs.
Instead of that ratemaking process outlined specifically in state law, the Maine Public Utilities Commission approved continuing an alternate rate plan set up for Bangor Gas, including the ability to negotiate separately with certain customers, such as Bucksport Energy and Verso.
Verso and Bucksport Energy raised concerns during the case that they would be supporting policy goals of expanding natural gas through the service area rather than paying only for Bangor Gas to recover its cost of service.
During the proceeding, the public advocate agreed that the alternate rate plan served a policy goal of encouraging expansion of natural gas delivery in the utility’s service area through its acquisition by Energy West in 2006, but that it is not appropriate to continue those rates.
The public advocate further argued for safeguards to protect against corporate malfeasance of the type that the Ohio Public Utilities Commission found Bangor Gas parent company Gas Natural Inc. committed through two subsidiaries. No accusations were lodged at Bangor Gas, and company officials said in December that the Ohio investigation would not affect its business.
In the appeal filed Monday, the public advocate asks the Maine Supreme Judicial Court to invalidate the commission’s order and the alternate rate plan, then send the case back to the Public Utilities Commission to establish a new Bangor Gas payment structure based on ratemaking procedures outlined in state statute.
Bangor Gas serves about 4,300 residential, commercial and industrial customers in Bangor, Brewer, Old Town, Veazie, Bucksport and Orono.
Watch bangordailynews.com for updates.