Peoples Gas price up
The price of Peoples Gas increased 149% in October, but some customers may not have noticed the increase because of a credit applied by the company for actual gas usage.
The price increased from $1.2337 to $3.08 per thousand cubic feet (Mcf), and customers getting gas directly through Peoples will see a credit of $3.79 per thousand cubic feet applied to their bill usage, according to a spokesman for Peoples.
Nick Paradise, communications manager for Peoples Gas, said a majority of Peoples customers in Butler County will see a credit of $3.79 per thousand cubic feet (Mcf) applied to their bills. The company charges customers for infrastructural costs as well as “the commodity cost,” which Paradise said is what Peoples charges for the actual gas usage. The commodity cost is where customers will see the credit applied.
“Essentially, we over-collected in previous quarters, because of the warmer-than-normal winters we have had,” Paradise said. “All customers who get their gas from Peoples ... If they have never chosen another supplier, they will automatically be getting this credit.”
The Pennsylvania Public Utility Commission announced Nov. 29 that all electric utilities regulated by the PUC would adjust their energy supply prices on Dec. 1. The PUC said the cost of energy used — either electricity or natural gas — can account for more than half of a typical customer’s bill.
Additionally, the price to compare for usage costs averages 40% to 60% of a customer’s total utility bill, with the percentage varying from customer to customer.
According to Paradise, the change in Peoples’ cost went into effect at the start of the quarter, which was Oct. 1. He said the increased cost comes directly from the cost Peoples is paying gas providers to get gas to customers, so the increase in rates are a net zero for the company.
Several other gas distribution companies changed their prices this quarter, according to the PUC, but the base price for Peoples is the highest of those regulated by the commission.
According to Paradise, Peoples did not announce the customer credit when reporting the changed cost for gas usage this quarter, in order to keep people from switching gas distribution companies for this quarter only. He added that the price for usage is actually down compared to last year, especially when taking into account the $3.79 per Mcf credit.
Butler County has about 37,500 Peoples customers, and nearly 900 of them — about 2% — are using a third party gas supplier rather than Peoples. Everyone but the two percent of third party customers will get the Mcf credit, Paradise said.
Paradise also said Peoples normally applies credits to customer bills across a longer period, but the $3.79 per Mcf credit is applied to this quarter only.
“When you factor in that credit, we're looking at gas rate, it is decreasing by 86% compared to third quarter,” Paradise said. “(The credit) has been applied across a three-month period, so it's a much larger figure, and that's partly why we reached agreement with PUC to not show the price to compare.”
Peoples could change the price for gas usage next quarter, which begins Jan. 1. However, Paradise said the new cost has not been proposed to the PUC yet.
“In order to make that change, the entity has to file a request through PUC,” Paradise said of the Mcf cost. “That typically doesn't get finalized until very close before the new quarter.”
