Bangor Natural Gas construction technicians shut off gas and replace a 10-foot section of a 1" service line on Hammond Street in 2017. Credit: Linda Coan O'Kresik / BDN

Bangor Natural Gas is withdrawing a 10-month-old request to raise distribution rates after state regulatory staff said the hike would result in “rate shock” to customers. The gas utility also said that it won’t seek a similar rate increase for another three years.  

Bangor Natural Gas sought the Maine Public Utilities Commission’s permission last March for a rate increase that would have raised the average residential customer’s monthly bill by more than 20 percent, or more than $24. It was the first increase the company had requested in 10 years.

But the commission’s staff in early December warned of the consequences of a 24.2 percent rate increase and said there was a need for gradualism. The staff experts also said the amount of revenue Bangor Natural Gas needs to run its distribution network would have represented a 24 percent decrease in distribution rates.

The company then voluntarily withdrew its request for the increase on Dec. 17, and said it wouldn’t seek a similar rate hike for three years.

Bangor Natural Gas serves 7,500 mostly residential customers in Bangor, Brewer, Orono, Veazie, Old Town, Bucksport, Searsport and Lincoln. Andrew Barrowman, the company’s sales and marketing manager, said last March that the utility was seeking to raise distribution rates to cover the growing costs of running its natural gas distribution network.

Bangor Natural Gas’ costs have risen as its customer base has grown, Barrowman said at the time. It’s more than doubled since 2012 when the company had 3,600 customers.

On Monday, the company declined to comment on its withdrawal of the rate hike request, saying the case before the Public Utilities Commission remains open.

In addition to residential customers, medium commercial customers would have seen their average monthly bill grow by a smaller percentage, 8.4 percent, but a larger dollar amount — more than $173. Other classes of customers would have seen a variety of rate increases.

While it appears the company’s distribution rates are likely to stay the same for the time being, customers are still seeing higher bills this heating season on the supply side of their bills due to the elevated cost of natural gas. 

The U.S. Energy Information Administration forecasted in October that natural gas bills would be 30 percent higher this winter than in years prior, largely due to higher retail prices for gas that stem from a cold snap last winter that forced many utilities to purchase gas at higher-than-anticipated prices.

Sawyer Loftus is an investigative reporter at the Bangor Daily News. A graduate of the University of Vermont, Sawyer grew up in Vermont where he worked for Vermont Public Radio, The Burlington Free Press...