FRANKFORT, Ky. (KT) – The Kentucky Public Service Commission (PSC) has denied Atmos Energy Corporation’s (Atmos) application and tariff to revise its Pipeline Replacement Program (PRP) rates.
Additionally, in the application Atmos had requested a waiver from the existing $30 million cap on annual PRP investments set by Commission Orders in 2017 and 2023.
In reviewing the tax implications of the proposed changes, the PSC found that Atmos’s method for projecting Net Operating Losses (NOL) and Accumulated Deferred Income Taxes (ADIT) did not provide an estimate that was reasonably connected to the actual NOL ADIT that would be generated. The agency concluded that Atmos failed to establish that its Kentucky operations were in a net operating loss position, and therefore, that its accelerated tax expensing of PRP investments could not be used to offset tax expense. The PSC found that Atmos’s PRP net rate base is $67,457,442 and its PRP revenue requirement is $7,741,241 which was $50,872 less than proposed.
On September 27, 2024, the PSC suspended the rates for one day, October 2, 2024, to ensure the orderly investigation of Atmos’s application and proposed rates. Pursuant to KRS 278.190(2), Atmos filed written notice to the PSC of its intention to place the suspended rates into effect on and after October 2, 2024, subject to refund, pending the final decision made by the PSC. The final rates approved by the PSC were lower than those placed into effect by Atmos, subject to refund. Atmos was ordered to refund to its customers all amounts collected for service rendered on and after October 2, 2024, that are in excess of the final rates approved by the PSC no later than July 28, 2025. By August 12, 2025, Atmos will provide the PSC a written report in which it describes its efforts to refund all monies collected in excess of the rates. The PSC will review the report to ensure Atmos reasonably refunded the monies owed.
Further, the PSC denied Atmos’ requested waiver from the existing $30 million cap on annual PRP investments, indicating the issue would be addressed in Atmos’ current pending application for an increase in general rates, which is now pending before the Commission in Case No. 2024-00276.
Atmos Energy provides natural gas to more than 184,500 customers in the Kentucky communities of Owensboro, Bowling Green, Paducah, Hopkinsville, Shelbyville, Lawrenceburg, Danville, Princeton and Campbellsville.
