Because of actions by PPL Gas Utilities to shield its customers from volatile natural gas prices, the company's gas rates will be slightly lower effective June 1.
PPL Gas Utilities has filed with the Pennsylvania Public Utility Commission to reduce the gas cost portion of customer bills to $8.06 per dekatherm, a reduction of 27 cents per dekatherm.
"Natural gas prices remain at high levels because supply is not keeping pace with demand nationwide," noted Robert M. Geneczko, president of PPL Gas Utilities. "We are able to give customers a short-term rate reduction because we made greater use of gas we had stored and bought less from companies that produce gas."
Under the new rate, the total monthly gas bill of a residential customer who uses 8 dekatherms per month will decrease by 2 percent, to $105.60 from $107.74. The effect on individual customers will vary depending on how much gas they use.
Typical commercial and industrial customers also will see reductions in their total gas bills of 2.3 percent and 2.5 percent respectively.
The cost of gas supply is a pass-through charge on customers' bills. Gas utilities are not allowed to make a profit on gas purchases. They may adjust rates quarterly, with approval of the PUC, to account for short-term changes in cost of buying gas for customers.
"Our approach to purchasing gas is to limit the effect of price changes on our customers," Geneczko said. "As a result, our Purchased Gas Cost Rate is below the state average."
Based on information from the PUC's Web site, the average rate charged by the state's largest natural gas delivery companies for gas purchases is currently more than $9 per thousand cubic feet. PPL Gas Utilities' rate of $8.06 per dekatherm is the equivalent of $8.27 per thousand cubic feet.
A dekatherm is a unit of heat energy in natural gas equal to 1 million British thermal units (BTUs). The energy in one dekatherm of natural gas can run a furnace for 10 hours, dry 72 loads of laundry or cook 23 12-pound turkeys.
PPL Gas Utilities is the local natural gas delivery company for 77,000 customers in parts of 34 Pennsylvania counties.