United
States
Securities
and Exchange Commission
Washington,
D.C. 20549
_______________________________
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date
of
Report (Date of earliest event reported): September 26, 2006
Chesapeake
Utilities Corporation
(Exact
name of registrant as specified in its charter)
|
Delaware
|
001-11590
|
51-0064146
|
(State
or other jurisdiction of
|
(Commission
|
|
incorporation
or organization)
|
File
Number)
|
|
909
Silver Lake Boulevard, Dover, Delaware 19904
(Address
of principal executive offices, including Zip Code)
(302)
734-6799
(Registrant's
Telephone Number, including Area Code)
_______________________________________________________________
(Former
name, former address and former fiscal year, if changed since last
report.)
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
[
]
Written communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
[
]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR
240.14a-12)
[
]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act
(17 CFR 240.14d-2(b))
[
]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act
(17 CFR 240.13e-4(c))
Item
8.01. Other Events.
On
September 26, 2006, Chesapeake Utilities Corporation (“the Company”) received
approval for a base rate increase from the Maryland Public Service Commission
(“PSC”) for the Company’s Maryland natural gas operations, with the new base
rates effective October 1, 2006. It was the Company’s first filing in the state
of Maryland in 11 years.
The
base
rate adjustment results in an increase in base rates of approximately
$780,000,
which would result in an increase in revenues of approximately 4.5 percent
on
average for the Company’s firm residential, commercial and industrial customers
in Maryland. This base rate increase translates into less than a one
percent
increase annually since the Company’s last filing 11 years ago, which is
significantly less than the rate of inflation over those same years.
In its
initial application, filed on May 1, 2006, the Company requested an increase
to
its base rates of approximately 6.5 percent on average for the Company’s firm
residential, commercial and industrial customers in Maryland.
In
addition, the PSC approved an increase in Chesapeake’s residential customer
charge from $7.00 to $9.10 per month. Under the
new base
rates, an average Maryland residential customer’s annualized bill would increase
approximately $2 per month effective October 1, 2006. For an average
residential
customer using 90 Ccf of natural gas per winter month, the estimated
impact
would be approximately $7 per winter month.
The
PSC
also approved the Company’s proposal to implement a revenue normalization
mechanism for its residential heating and smaller commercial heating
customers,
reducing the Company’s risk due to weather and usage changes. As a result of
this revenue normalization mechanism, on a consolidated basis, the Company’s
margin per Heating Degree Day (“HDD”) will decrease from $3,977 per HDD to
$3,375 per HDD.
The
rate
adjustment will cover the increase in expenses and investment in infrastructure
necessary to continue providing the current level of service to the Company’s
Maryland division customers. Within this approval, the Company’s Maryland
division is also permitted to recover and amortize over a 10-year period
approximately $1,159,000 of previously incurred environmental remediation
costs.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant
has
duly caused this Report to be signed on its behalf by the undersigned hereunto
duly authorized.
Chesapeake
Utilities Corporation
/s/
Michael
P. McMasters
—————————————
Michael
P. McMasters
Senior
Vice President and Chief Financial Officer
Date: October
2, 2006