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Gas Rates Decrease

GUC has reduced natural gas rates for its customers for the third time in the past six months. Effective January 1, the average wintertime residential user of 75 ccf (hundred cubic feet) will see a decrease of approximately $6.70 per month. Depending upon the amount of gas used, residential customers will see a decrease of approximately 5.50%. 

Natural gas prices continued to decline during December despite some very cold weather across the middle and eastern part of the country. As a result, the market price of natural gas decreased significantly, and GUC is passing those projected savings onto our customers.

This is the third "tracking" decrease in natural gas rates that we've passed on to customers in recent months. We had a 16% decrease in August 2008, a 6% decrease in October and, now we've passed on a 5% decrease effective January 1. That's a total decrease of more than 25%. Combined, the three decreases have resulted in a total savings of $17.33 per month for the average residential user.

GUC purchases natural gas through marketers on the open market. In addition to paying for the cost of the gas itself, we also pay to have it transported from the Gulf of Mexico to our system. A competitive market determines the price of natural gas, which is a commodity traded on the open market like wheat, oil, lumber and orange juice. The market price of natural gas is dictated by supply and demand. When demand is high, the price rises. When supply is high, the price drops.

Natural gas rates are set using a base rate that accounts for transportation and utility costs, then adjusted each month based on the fluctuating price of the gas itself.

GUC does not profit from fluctuations in gas costs. All costs associated with increases or decreases in the commodity price of natural gas are normally passed along to customers on a dollar-for-dollar basis. In other words, we simply “track” the increases or decreases to our customers.