ALBANY — National Grid customers could get a nice surprise in their bills starting in April when the company is planning to lower its gas and electric rates by roughly 10 percent.

If approved by the state Public Service Commission early next year, the rate reduction would be the second reduction that customers will have enjoyed since January of this year, when National Grid electric delivery rates fell 11 percent.

Delivery rates only make up about half of a customer's monthly utility bill — the other half is the cost of the supply of electricity or gas. But because both electricity and natural gas have been at historic lows, overall bills are sure to follow.

National Grid, state regulators and business and consumer groups recently reached an agreement on the company's rate structure in what's known as a settlement or "joint proposal" that can be used by the five-member PSC board as a starting point for a decision on whether to approve National Grid's request to change rates. Consumers will still be given the opportunity to make comments on the rate case at PSC-sponsored public hearings.

"This settlement proposal delivers on the mutual goals of National Grid and other parties who represent our customers," said Ken Daly, president of National Grid's New York operations. "We believe the outcome will benefit our customers and meet the goals of our original proposal for rate stability, continued system investment and expanded low-income and economic development programs."

As part of the deal, National Grid would also commit to upgrade its gas and electric systems by $1.6 billion over a three-year period. National Grid recently completed a $1.5 billion improvement to its upstate New York electrical system.

Under the gas and electric plan, National Grid is actually raising the amount of revenue that it collects from customers. But overall rates will fall in the first year for both gas and electric customers because of past fees that will expire in April and because of expected savings that will be phased in over a three-year period.

Gas delivery rates will actually increase in years two and three, as will electric delivery rates. But National Grid says that the rise in electric rates will not increase above where they are today.

lrulison@timesunion.com • 518-454-5504 • @larryrulison