Reflecting a nationwide spike in fuel prices, PPL Corporation's natural gas subsidiary is increasing the Gas Supply Charge portion of customers' bills. Effective March 1, the total monthly gas bill for a typical residential customer will increase by about 11 percent.
"We know this is not welcome news for our customers, especially with the current state of the economy," said Robert M. Geneczko, president of PPL Gas Utilities Corporation. "We understand the added pressure higher natural gas prices will put on household budgets, and we are committed to helping our customers — especially those with limited or fixed incomes — cope with the effects."
Starting March 1, the Gas Supply Charge will increase from $5.22 to $6.37 per dekatherm, which is a unit of natural gas use. Customers can find on their monthly gas bills how many dekatherms they use.
The total gas bill for a residential customer who uses 8 dekatherms a month will increase by 11.1 percent to $92.90. The actual amount of the increase will vary depending on how much gas customers use.
PPL Gas Utilities buys nearly all of the gas it needs from suppliers on the open market, Geneczko said.
"Gas purchase costs are a pass-through charge on our bills; we make no profit on them," he explained. "Our business is delivering gas to customers through our local pipeline network — so it actually hurts our business when higher prices drive customers to reduce their gas use."
Programs and services to help customers include Budget Billing, which takes seasonal variations out of natural gas bills and enables customers to make even monthly payments based on their annual use. The company also has programs for customers with limited ability to pay the gas bills. For information, customers should call the toll-free customer service number, 1-800-652-0550, weekdays from 8 a.m. to 5 p.m.
"We try, through our gas purchasing strategy, to buy gas at the lowest possible cost and shield customers as much as possible from changing market prices," he said, "but we have seen significant increases this winter in the wellhead prices charged by suppliers."
Natural gas prices have mirrored gasoline, heating oil and other fossil fuels due to greater demand, the extremely cold winter in the Northeast and tighter supply, according to the American Gas Association.
One bit of good news for customers is that the supply charge increase takes effect at a time when gas use by many residential customers is decreasing.
"For customers with gas home heating, about 60 percent of their annual gas use is in December, January and February," Geneczko said. "For those months, customers had the benefit of a reduction in the supply charge that went into effect Dec. 1," he said.
Total monthly gas bills for typical commercial and industrial customers will increase by 13.7 percent and 15.3 percent respectively on March 1 because of the supply charge.
Gas utilities may adjust their supply charge periodically to reflect short-term changes in the price they pay for natural gas.
PPL Gas Utilities, a subsidiary of PPL Corporation (NYSE: PPL), serves 75,000 natural gas customers in parts of 34 Pennsylvania counties through its gas utility subsidiaries PFG Gas and North Penn Gas.