Home >

Study Results in Rate/Fee Adjustments for Natural Gas

Greenville Utilities is a community-owned utility, with not-for-profit operations. Unlike private utilities, we are not driven to maximize profits for out-of-town stockholders. Revenues from our rates and charges benefit customers, not investors. All rates/charges go right back into the utility system to provide safe, reliable services; maintain operations; and support the ongoing economic growth of Greenville-Pitt County.

Rates are developed on a “cost-to-serve” basis, designed to recover costs associated with purchasing and delivering services to all of our customers (residential, commercial, industrial). In addition, we must have an adequate amount of funds to meet bond requirements, invest in the system, prepare for emergency situations, and maintain a healthy financial position.

To keep a watchful eye on prudent spending, good business practices, customer expectations and system reliability, periodically Greenville Utilities conducts comprehensive rate studies to ensure rates and charges accurately reflect current costs.

Our recent natural gas rate study, conducted by Energy Resource Consulting Group (ERG), has determined what our gas rates and charges need to be in order for us to recover our costs and provide safe, reliable and efficient service to our customers, now and for the next several years. As a result of the study, adjustments have been made to natural gas rates and charges, effective May 1, 2007.

Base Rate
The new natural gas rate structure has one year-round rate, which is easier and more convenient for customers. Residential (year-’round) customers using 50 ccf/month will see their bills increase by $1.24/month (from $89.12 to $90.36).

Residential (heat-only) customers using 50 ccf/month will see bills increase by $3.89/month (from $92.32 to $96.21).

Adjustments have also been made for commercial and industrial customers. To reference our complete rate schedules, click here.

This is the first change in natural gas base rates since 1999. In that same eight-year timeframe, the Gas System’s cost of doing business has increased significantly – 8% per year- since 1999, from ongoing operations and maintenance expenses to the cost of installing new pipelines to meet growing demand. These costs are directly affected by the rising price of equipment, fuel, energy, supplies, materials and insurance.

It is important to remember that GUC doesn’t produce natural gas. Through our marketers, we purchase all of our gas on the open market, and pay to have it transported from the Gulf of Mexico through the Transcontinental (Transco) pipeline. Greenville Utilities must pay the costs associated with transporting the gas from the Henry Hub (near New Orleans) to Greenville.  Many utilities in the Southeast are located along the Transco Pipeline and are, therefore, able to save this transportation cost. Greenville is located virtually across the state from the main pipeline so we must pay additional transportation costs. GUC pays transportation charges to both the interstate and intrastate pipelines for gas transported along their systems.

The Transco pipeline connects to an intrastate pipeline, owned by Piedmont Natural Gas (PNG), in the western part of North Carolina. We also pay a fee to PNG to transport the gas through their pipeline, across the state, to a delivery point in Greenville, and into GUC’s distribution system.

To use their facilities, we pay PNG over $270,000/month ($3.2 million/year) as a fee (just like the “base facilities” charge” our customers pay), no matter how much gas we transport. That $3.2 million/year represents 12% of GUC’s total gas costs. (The current bills that our customers pay are on average 12% higher than PNG.)

A typical residential customer's natural gas bill is made up of two parts: distribution costs and the cost of wholesale natural gas.

For every dollar a customer pays for natural gas, 77 cents goes to pay for purchased (wholesale) gas, leaving only 23 cents for GUC operations & maintenance (17%), City turnover (3%) and debt service (3%).  That entire 23 cents goes directly back into the system and is used to provide safe, reliable natural gas to our community.


Natural Gas Fees
GUC’s natural gas service charges (or fees) have not changed since 1993. These fees are intended to recover the costs incurred to activate a natural gas service, relight pilots and change delivery pressure. Effective May 1, 2007, these fees will increase by $15 in the summer (April through October) and $35 in the winter (November through March). The tap fee will increase from $75 to $125. For a complete listing of fees,
click here.

Customers Can Take Steps to Manage Their Energy Bills
We encourage customers to actively pursue ways to lower their energy usage and costs.

Call GUC’s Energy Services Office at 551-1525 for specific tips on lowering your energy bill. Additional energy saving tips are available by clicking here.