Columbia Gas is returning $77.8 million to its customers who were overcharged for natural gas between Oct. 1, 2008, and Sept. 30 of this year.

The state Public Utility Commission approved the refund to close the gap between what Columbia paid for its gas during that period and what it charged its customers. State law requires that natural gas utilities neither make nor lose money on the commodity itself.

Customers will not need to do anything to receive the refund, which will come in the form of a one-time credit on bills for the November billing cycle. If a credit exceeds a customer's balance for the month, the remainder will be carried over to the next billing cycle. In that case, the customer will have the option of receiving the remainder as either a credit or a check.

Tom Cuddy, Columbia's director of communications and community relations, said the amount of a customer's refund would depend on how much gas that customer purchased from Columbia from October 2008 through September 2009.

"If you purchased natural gas from Columbia Gas in at least one month [during the subject year], you will receive a credit," he said.

Mr. Cuddy said about 350,000 of Columbia's 413,000 customers would be eligible for the refund. Customers who already participate in a customer-assistance program will not be eligible. Budget customers will receive the November credit, and Columbia will then review the customer's payment plan amount to determine if it needs to be adjusted.

For people who stopped being Columbia customers during the past year, the credits will first be applied to any remaining balances on their accounts. Any remaining credit will then be sent by check to the address on file for that customer.

Each April, Columbia (along with the area's other two natural gas utilities, Dominion Peoples and Equitable Gas) files a rate request for the following October-to-September period. In April 2008, when Columbia filed its 2008-2009 rate request, the wholesale price of natural gas was rising steeply, and it continued rising until July, when it began to fall just as quickly. By the time the proposed rates went into effect last October, the wholesale price was lower than it had been in April. As the downward trend continued, Columbia used quarterly filings to adjust its rates downward, but still ended its rate year last month with overcollections.

Normally, a refund to customers for overcollections in a given year is spread out over the following year. Dominion Peoples has included such a refund in its new rates that went into effect Oct. 1. Equitable Gas concluded that it did not need to make any refunds.

Mr. Cuddy said Columbia, in its Sept. 17 filing, specifically asked the PUC's permission to give this refund in a lump sum during the November billing period.

"We realize that, now more than ever, customers can use this type of boost as we head into the winter holiday months, especially given this economy," he said.

The commission agreed that "a refund in a lump sum might be more useful now to consumers," said spokeswoman Jennifer R. Kocher.

Columbia serves customers in 26 Western Pennsylvania counties.

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