CLEARFIELD TWP — Customers of Herman Oil and Gas may be in store for a significant hike in their monthly gas bills.

The natural gas company is seeking a 149 percent increase in the base rate for its 419 customers.

The increase is scheduled to go into effect July 1, but the final amount is dependent upon approval by the state Public Utility Commission.

Andrew Smith, the owner of the company, said the increase is needed to provide quality service.

“We have not increased rates in 32 years,” he said, claiming mismanagement by previous owners.

Smith bought the company in August.

According to a letter sent to its customers this month, the gas company has requested an overall rate increase of more than $698,000 a year. In addition to the rate increase, the company also is requesting a customer charge increase of more than $80,000 a year.

Under the proposal, the rate per MCF of natural gas per month will increase from $7.05 to $17.58.

The customer charge will be in the form of a separate $16 flat rate meter charge per month.

Smith said the typical home uses 10 to 15 MCFs per month during the winter, and about 1 or 2 MCFs during the summer.

For a family using 10 MCFs in a month, its bill will jump from about $70 to about $192 if the rates are approved.

Smith said the rate increases and additional charges are needed to fund safety and reliability improvements of the distribution system. He acknowledged the spike may be shocking to customers, but said the final rates still will be less than what other gas companies charge.

“Our current rates are about a third of what (other companies) charge,” he said.

The PUC can prevent rates from increasing until it investigates the request. The company must prove the rates are reasonable before approval is granted.

The PUC may grant all, some or none of the request.

Smith said the PUC likely won’t make a decision for up to six months.

“They do a full audit before making a decision,” he said. “They audit everything.”

Smith said if his company is granted the additional rates, it will begin replacing a 30-mile stretch of outdated steel pipeline.

“It takes a tremendous amount of money to stay in compliance with the PUC,” he said. “We need the increase to ultimately provide better service to our customers.”

To find out how the increase would affect your gas bill, call the company at 724-841-0341.

Customers may file a complaint with the PUC by July 1 to challenge the rate increase. They also may send a letter stating their objections to the PUC at P.O. Box 3265, Harrisburg, PA, 17105.