DES MOINES, Iowa – (June 8, 2023) – MidAmerican Energy will file a request with the Iowa Utilities Board next week seeking the board’s approval for an increase to its natural gas delivery rates in Iowa. This would be the company’s first gas rate increase in the state since 2002.

 

MidAmerican projects its request would result in an average 6% increase of total monthly gas bills in Iowa. If approved, the average residential customer would see an estimated monthly gas bill increase of less than $5, or $60 per year. Although the rates would increase for the delivery of natural gas, the price of the natural gas fuel has been declining. If this trend continues, MidAmerican estimates that customers will see an estimated 30% decrease in their year-over-year bills.

 

“At MidAmerican, we understand that inflation has put financial pressures on our customers, which is why we’ve done our best to control costs and file for this increase at a time when natural gas costs are the lowest they’ve been in years,” Nick Nation, vice president of gas delivery at MidAmerican, said.

“We work hard every day to keep energy costs as affordable for our customers as we possibly can, which is how we’ve been able to control costs and keep our gas rates the same for more than 20 years,” Nation continued. “Over that time, we have invested heavily in our natural gas system to make sure we can continue to safely and reliably serve our growing customer base here in Iowa. This request will help ensure we can continue to dependably deliver natural gas to homes and businesses in the communities we serve.”

Growing customer base, communities, safety improvements and new security standards necessitate increase
Since 2002, MidAmerican’s natural gas customer base has increased by nearly 100,000 customers, or 20%. The communities MidAmerican serves are growing, too, requiring the addition and relocation of gas facilities to accommodate the construction, maintenance or repair of roads and bridges and other public improvements. To maintain both safety and reliability, MidAmerican has invested in many capital projects and upgrades.

Cybersecurity and physical threats to the gas delivery system are very different than they were 20 years ago. Because of attacks on gas pipelines, new security standards required by the U.S. Transportation Security Administration, which is tasked with safeguarding pipelines, have been implemented, increasing compliance costs.  

Delivery base rates to increase only, interim rates to take effect this month
The proposed change would affect gas delivery base rates, which are part of the delivery portion of a bill. Delivery base rates include monthly charges and costs associated with providing gas service to customers and ensuring system safety.

The increase would not affect the supply portion of monthly bills, which reflects the amount of gas MidAmerican buys each month on behalf of a customer and is based on fluctuating market costs without a markup. The market price of gas has been declining since last fall, lessening the impact of the delivery rate increase. 

While MidAmerican’s rate increase request is pending with the Iowa Utilities Board, state law allows the company to implement an interim rate increase, which would result in a 5% average increase of total monthly gas bills.

If the Iowa Utilities Board approves MidAmerican’s requested increase at a lower level than the interim rates, MidAmerican will refund the difference to customers through a bill credit, plus interest.

MidAmerican serves 611,000 gas customers in Iowa.

Iowa Utilities Board to rule on proposed increase
Once MidAmerican files its rate increase request with the Iowa Utilities Board, the board will begin a process to determine whether the proposed rate increase is justified and reasonable. The board will seek comments from customers and interested parties and make a final determination in May of next year.

Public meetings on the topic are scheduled across MidAmerican’s Iowa service area at the dates, times and locations below:

 

Details about participating online and at the customer comment meetings are available on the IUB’s website, iub.iowa.gov.

 

About MidAmerican Energy Company
MidAmerican Energy Company, headquartered in Des Moines, Iowa, serves 813,000 electric customers in Iowa, Illinois and South Dakota, and 789,000 natural gas customers in Iowa, Illinois, Nebraska and South Dakota. Information about MidAmerican Energy is available at MidAmericanEnergy.com and company social media channels.

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