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Note 4 - Rates and Regulatory Matters

9 Months Ended

Jun. 30, 2025

Public Utilities Disclosure [Text Block]

4.	Rates and Regulatory Matters

The SCC exercises regulatory authority over the natural gas operations of Roanoke Gas. Such regulation encompasses terms, conditions and rates to be charged to customers for natural gas service, safety standards, service extension and depreciation.

In response to continued inflationary pressures, Roanoke Gas filed a general rate application with the SCC on February 2, 2024 seeking to increase its annual non-gas base rates by $4.33 million and its permitted return on equity from 9.44% to 10.35% reflecting its higher cost of capital, including higher interest expense. The SCC permitted the Company to implement its new rates on an interim basis for customer billings on or after July 1, 2024, subject to refund. On October 16, 2024, the Company reached a settlement with the SCC staff on all outstanding issues in the case. Under the terms of the settlement, the Company agreed to an annual incremental revenue requirement increase of $4.08 million based on a return on equity of 9.90%. On April 10, 2025, the SCC issued a final order approving the settlement agreement in its entirety. Refunds for the difference in amounts that were billed based on interim and settlement rates, which had previously been accrued, were made to customers in May 2025.

On May 30, 2025, Roanoke Gas filed for approval of an updated RNG Rider to become effective October 1, 2025. The revenue requirement associated with the proposed RNG Rider is $1.66 million, offset by the sale of environmental credits, the recovery of under recovery of costs during the prior fiscal year and the over crediting of customers for RIN sales. The Company expects a decision from the SCC in September 2025.

On June 30, 2025, Roanoke Gas filed for approval of an updated annual SAVE Rider rate to become effective October 1, 2025. The proposed SAVE Rider is based on an estimated $10.33 million of SAVE eligible investment during fiscal 2026 and a revenue requirement of $2.64 million, inclusive of the adjustment for under-recovered costs incurred during the prior year. The updated SAVE Rider also reflects the cost of capital approved by the Commission in its April 10, 2025 Rate Case Final Order. The Company expects a decision from the SCC in September 2025.