There’s good news for customers who purchase their natural gas at a utility’s standard offer.
The latest auction to determine the price for the monthly rate for the next year came in at a historic low and 17 cents cheaper than the “adder” from this past year. The “adder” will be 43 cents per thousand cubic feet (mcf), down from 60 cents/mcf for the past two years, $1/mcf in 2012 and $1.20/mcf in 2011.
The 43-cent/mcf “adder” is the lowest price since the Commission approved the auction process in 2006.
Customers who purchase their gas with the Standard Choice Offer (SCO) rate are assigned a provider by Dominion East Ohio and pay a rate that is based on a state-approved formula to determine the monthly rate.
On Tuesday, the Public Utilities Commission of Ohio held the annual auction to determine next year’s “adder” for the state-approved formula. The results were certified on Wednesday for release.
The SCO rate is determined by using the settlement price on the third to last day of the previous month on the New York Mercantile Exchange plus the now 43-cent/mcf price.
The new prices will be effective with April bills, Dominion East Ohio said. Four winning suppliers submitted successful bids to provide natural gas to about 180,000 SCO customers and 120,000 SSO customers, out of Dominion’s 1.2 million customers.
“We’re very pleased that our auction results came in so low,” said Jeff Murphy, Dominion East Ohio’s managing director, Commercial Operations. “With natural gas pricing on the New York Mercantile Exchange rising because of the much colder-than-normal weather across much of the nation, this record low result for the auction will help keep many of customers’ bills lower than they would be otherwise.”
The SCO price for February bills beginning Feb. 14 rose to a high of $6.16/mcf because the market temporarily spiked because of weather concerns and then fell again. The SCO in 2013 had ranged from a low of $3.83/mcf in February to a high of $4.75/mcf in May and June.