Summit Utilities presents proposed natural-gas rate increase; public hearing set for April 14

Summit Utilities representatives on Monday told the Texarkana City Council they plan to raise base natural-gas rates, citing roughly $13 million in new Texas investments and higher depreciation and capital costs. The company proposed an effective date of May 1, 2025 and the council set a public hearing and council action for its April 14 meeting.

Why it matters: The proposed change would shift part of the utility’s cost recovery from an Arkansas-approved rate structure to a Texas municipal review and, if approved, would raise average monthly customer bills in Texarkana from about $46 to about $62, the company said.

Summit Utilities’ Brooke Parsons, director of regulatory affairs, told the council the company wanted to give residents an early informational presentation before the April public hearing. Philip Gillum, Summit’s director of rates, said the primary drivers of the change are increased capital investment in the Texas system and the related rise in depreciation expense. “The proposed increase more accurately reflects our current cost of business,” Gillum said.

Gillum said Summit acquired assets previously owned by CenterPoint and that Summit filed a related rate application with the Arkansas Public Service Commission on Jan. 25, 2024. Because the company serves a small number of Texas customers on lines that cross the state line, Summit said it is proposing to use the Arkansas proceeding as a proxy rather than pursue a separate Texas evidentiary rate case, which it said would raise administrative costs.

Operations director Greg Strickland described recent pipeline work in the area, saying the utility replaced about 5.27 miles of mainline in 2024 in neighborhoods near Richmond Road north of the interstate and worked on associated service lines. He said customers were typically notified by door knocks and door hangers when crews worked near homes.

Summit’s presentation included these estimates for Texarkana customers: an average annual bill rising from about $46 per month to about $62 per month; a per-month summer average increase of about $11 and a per-month annual-average impact of about $16. The company said, as a percentage, the base-rate portion would rise about 63% and the overall bill would rise about 25% (gas-supply charges fluctuate seasonally). Gillum also said the Texas-only cost-of-service difference compared with filing a Texas rate case would be roughly $700,000, driven by differing cost allocations between Arkansas and Texas.

Council members pressed for technical details. Councilmember Thompson asked about depreciation accounting and whether the company was receiving credit for accelerated tax depreciation; Gillum explained the difference between book and tax depreciation and said that depreciation is part of the rate-base calculation. Strickland agreed to follow up with a resident who said work had not reached his neighborhood.

Summit said it will run legal notices in local newspapers for four consecutive weeks before final action, will notify the four incorporated Texas cities it serves by email, and will provide customer-service talking points and information about levelized billing to help customers manage seasonal swings. The council did not vote on the proposal Monday; staff and Summit said the matter will return for a public hearing and formal council action on April 14.