How is ESPs gas rate structured?
The current gas rate, which went into effect with Cycle 01 billing, June 2007, is a single block system that is comprised of three parts: customer charge, fuel cost and distribution cost. You pay the same rate per unit regardless of the amount of natural gas consumed. The current components will allow adjustments to your account based on fuel cost and abnormal weather. Customer Charge – is a fixed monthly cost to provide natural gas to your home or business. It covers the cost of billing, meter reading and equipment at the service address. This will also be your minimum bill regardless of the amount of natural gas consumed. Fuel Cost – includes the commodity cost to purchase and transport natural gas to the City’s distribution system. Distribution Cost – includes all other costs for operation and maintenance of the gas system, materials, equipment and facility costs. Purchase Gas Adjustment (PGA) – is the recovery mechanism or model for the fuel costs. If fuel costs increase or decreas
