National Fuel Gas Lowers Prices By 5.2 Percent
ERIE, Pa. – The Pennsylvania division of National Fuel Gas Distribution Corporation (National Fuel) has announced a quarterly adjustment to Gas Supply Charges effective Nov. 1, 2013. This adjustment will lower the monthly bill of a typical residential customer in northwestern Pennsylvania by $4.13, from $79.73 to $75.60, or by 5.2 percent.
“This adjustment to gas supply charges reflects lower than projected costs for gas purchased by the company during the months of August and September,” said Sandra James, Director of Corporate Communications. As is the practice for all Pennsylvania utilities, National Fuel projects annual natural gas prices and then performs quarterly reconciliations of actual costs against what had been estimated. National Fuel is required by law to pass any increase or decrease in gas supply charges on to customers with no markup or profit.
“Over the past few years, customers have benefited from declining gas costs going into the heating season,” James added. “Winter bills are typically higher due to increased consumption. The good news is that this winter customers will be paying slightly less for the commodity than last year and 43 percent less than five years ago.”
This is due, in part, to increased production of Marcellus Shale gas. Customers can be assured that a steady supply of natural gas will more than meet the demand this winter as gas production is increasing and will probably set new records, according to the American Gas Association and the U.S. Energy Information Administration.
Pennsylvania utility companies are permitted to update gas supply charges on a quarterly basis to reflect actual changes in market prices and to pass these costs on to customers. Customers are reminded that the gas supply charge also includes charges the company must pay to transport and store gas for its customers. As a result, the gas supply charge on a customer’s bill will never exactly match the spot market price of gas, which reflects only the current daily price of the commodity.
Residential customers who are comparing the Utility costs to offers from other natural gas suppliers will want to note that this brings National Fuel’s residential “price to compare” to $0.54559 per hundred cubic feet.
Utility companies do not set market gas prices and are required to pass these costs on to customers on a dollar-for-dollar basis through the gas supply charge. This differs from the delivery service charge, which represents the utility’s cost of doing business and providing safe, reliable service to customers. These delivery service charges are also regulated by the Pennsylvania Public Utility Commission and have not changed since January 2007.