Houston-based CenterPoint Energy announced a settlement with area municipalities in its bid to raise gas-related charges to customer, a day after proposing an increase to its rates for electricity.

CenterPoint notified regulators today the agreed upon increase to its natural gas distribution rates amounts to a $16.5 million jump in the utility's yearly revenue.

Thomas Brocato, general counsel for the Gulf Coast Coalition of Cities, confirmed the agreed upon amount.

The proposed settlement awaits approval by the Texas Railroad Commission. If approved, the rates will go into effect in May or June.

CenterPoint had been in negotiations with GCCC and other parties since it filed paperwork in November that called for a revenue increase of $31 million.

Brocato said the agreement avoids the litigation costs of arguing the increase in court and also takes away the uncertainty of the railroad commission, which regulates the industry, green-lighting a larger increase.

“We believe that it’s a good outcome, taking into account what could have occurred if we’d proceeded,” Brocato said.

As part of the settlement, CenterPoint will partially consolidate its two service areas, the Houston area and the Texas coast area. Cities in each service area have been paying different distribution rates for natural gas.