The New York State Public Service Commission on Thursday adopted a three-year rate plan for gas service provided by National Fuel Gas Distribution Corp.

It takes effect Jan. 1 and is the first increase to National Fuel’s base delivery rates in New York since 2017 and only the second increase in 16 years.

The rate plan was supported by the company, the Department of Public Service , a group representing large commercial customers, the International Brotherhood of Electrical Workers (IBEW) Local Union 2199, and IBEW Local Union 2154. National Fuel serves about 527,000 residential and commercial customers in 14 Western New York counties.

“With this three-year rate plan, the company will be able to continue to provide its customers safe and reliable gas service, as well as continuing to work on developing a cleaner energy distribution system,” said Commission Chair Rory M. Christian. “Adoption of this rate plan ensures critical investments are made for the continuation of safe and reliable service.”

National Fuel initially requested a first-year increase in annual gas delivery revenues of approximately $88.8 million — a 30.8% increase in base delivery revenues or 11.1% increase in total revenues for the 12-month period ending Sept. 30. Instead of granting the full amount, the Commission adopted a first year levelized increase of only $37.1 million, less than half of what the company originally requested.

Had National Fuel’s requested first-year rate increase been approved, an average residential heating customer would have seen their total monthly bill increase by $11.31, a rise of 13.7 percent. With this week’s decision, in the first-rate year, an average residential heating customer’s total monthly bill will go up $6.57, or 8 percent, to $89.24. The company will begin billing the new rates January 1, 2025.

In addition to lowering the rate increase, key elements of the Commission’s decision include the reopening of three walk-in customer service centers in Buffalo, Cheektowaga and Jamestown; language assistance for non-English speaking customers; the establishment of gas safety and customer service performance metrics; the formalization of cold weather protections for residential customers; and enhancement of the company’s energy affordability program.

Since its last rate case in 2016, National Fuel said it has invested $473 million in modernizing its system, having replaced more than 884 miles of pipeline in New York. The company is planning an additional $360 million of capital expenditures over the next three years to ensure it continues to provide safe and reliable energy service for its customers.

Even after the rate increase takes effect, National Fuel’s residential delivery rates will continue to be among the lowest for large natural gas utilities in the state. According to Donna L. DeCarolis, National Fuel Gas Distribution Corporation President, as a result of smart and efficient cost management practices and a focus on customer affordability, the Company has been able to avoid the need for rate increases for nearly eight years while continuing to invest significantly in safety and system modernization.

“National Fuel, like families and businesses across Western New York, has experienced rising costs due to inflation,” she said. “This rate increase was necessary for National Fuel to maintain critical infrastructure, improve our customer experience, and continue to focus on emissions reduction, all while delivering the safe, reliable and affordable energy that 90 percent of Western New Yorkers count on for home heating and comfort.”

The Commission’s decision recognizes the results of a recent Department investigation into the company’s political advocacy expenditures and requires enhanced reporting of employee work time spent on advocacy-related tasks.