Some Columbia Gas customers in Clark, Champaign to see lower heating bills

The arctic weather that has crippled the area has many people worried about their heating bills increasing. But, heating bills for those who use natural gas in Clark and Champaign counties could actually be falling because Columbia Gas customers who buy their gas through the Standard Choice Offer (SCO) will see a lower natural gas price just as bills for January’s bitter cold arrive.

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Columbia spokesman Dave Rau said the company has 38,000 residential customers in Clark County and 5,000 residential customers in Champaign County. The company gives customers the option of buying gas through the SCO or from a marketer.

“It’s likely they are split 50-50 between the Standard Choice Offer and the other options (purchase from a marketer or from a program sponsored by their local government),” he explained. “Market prices for natural gas were high at the start of the heating season. You might remember that we had a very warm fall.”

Columbia charges by the 100 cubic feet, or ccf. The SCO monthly variable prices are linked to the price of natural gas set at the end of each month on the New York Mercantile Exchange, where gas is traded just like oil. Current rates through March, with the retail price adjustment is $0.123 per hundred cubic feet (ccf).

Vectren also serves some of the customers in Clark and Champaign counties and the company said its retail price adjustment through March is $0.087 per hundred cubic feet (ccf).

Marketers may offer prices or terms that are different from the SCO, and those appeal to many customers who like to price shop.

"We encourage customers to be smart shoppers and check the PUCO's Apples to Apples site to compare offers at," Rau said.

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Thanks to warmer weather, there has been more natural gas available and that has driven costs down.

“Power plants used lots of natural gas to generate electricity to meet air conditioning demand, so less gas went into storage than usual,” Rau said. “There has been plenty of natural gas available, and prices have been falling since December.”

Matt Schilling of the Public Utility Commission of Ohio (PUCO), said SCO customers are actually buying the gas from a number of independent suppliers that have competed to be in the program through an auction and have agreed to charge the price set by PUCO.

“The auction establishes a standard choice offer rate for choice-eligible customers and a direct sales service rate for Percentage of Income Payment Plan Plus customers and other choice-ineligible customers,” he said.

Public and Legislative Affairs Specialist, Jon Blackwood, with the Ohio Consumer’s Counsel, told the Springfield News-Sun Thursday afternoon, that Columbia’s market price for natural gas is low because the supply of natural gas in Ohio and elsewhere is high compared to consumer demand.

“There is abundant ‘shale gas’ available in eastern Ohio and elsewhere,” he said. “Additionally, Columbia’s auction process is very competitive with multiple suppliers vying to provide gas to Columbia.”

Blackwood said markets should benefit consumers, including the lowering of prices.

“In recent years, the utilities’ ‘standard choice offers – which result from fierce competitive bidding – have often produced the lowest natural gas prices for Ohio consumers,” he said. “Unfortunately, it is difficult for consumers to know that. Recent calculations have shown that consumers are widely accepting higher-priced offers from marketers and paying more, when they could be choosing the utility’s lower-priced offer.”

Columbia has calculated that consumers who buy gas from marketers instead of from them, have paid more than a billion dollars above Columbia’s prices, he added.

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