Summary
Atmos Energy Corporation's Mid-Tex Division has reached a significant settlement agreement with two coalitions representing 148 and 52 cities, respectively, resolving issues related to its March 2010 annual Rate Review Mechanism (RRM) filing. This agreement, subject to city approval, will lead to approximately $22 million in additional annual revenue for the Mid-Tex Division starting October 1, 2010, reflecting adjusted rates. The settlement also includes key provisions for the company's infrastructure, such as an expanded program to replace approximately 100,000 steel service lines by September 30, 2012, with a projected capital cost of $80-$120 million. This program focuses on high-priority lines identified in cooperation with the Texas Railroad Commission and aims to minimize customer disruption. The RRM filing process will be extended for two years, but the company is required to file a system-wide general rate case by June 1, 2013.
Key Highlights
- 1Settlement reached between Atmos Energy's Mid-Tex Division and 200 cities (148 via ACSC, 52 via ATM).
- 2Additional annual revenue of approximately $22 million expected for the Mid-Tex Division from October 1, 2010.
- 3Authorized return on equity set at 9.7 percent for general operations, based on actual capital structure up to 50% equity.
- 4Rate Review Mechanism (RRM) filing process extended for an additional two-year period.
- 5Company must file a general system-wide rate case on or before June 1, 2013.
- 6Expanded steel service line replacement program targeting 100,000 lines by September 30, 2012.
- 7Projected capital cost for steel service line replacement is $80-$120 million, with an authorized return on equity of 9.0 percent for this program.