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PECO Will Lower Its Natural Gas Rate By Almost Four Percent on December 1

Posted on: Tuesday, 20 November 2007, 12:00 CST

With the colder weather staying around for the next several months, good news from PECO for its natural gas customers in the Philadelphia suburban counties. PECO will lower its natural gas rate by almost four percent on December 1.

PECO's new rate for natural gas service will drop from $1.34 per hundred cubic feet (ccf) of gas to $1.28 per ccf. The average usage for a residential customer is about 1,100 ccf annually, but ranges widely monthly based on weather and reflects home energy efficiency and household size (i.e. from apartments and townhouses to large single-family homes). The rate decrease will mean savings of about $10 per month for the typical residential customer based on 200 ccf of winter usage, at least for the next three months.

The rate change is a reconciliation of PECO's actual gas supply costs this year and a projection of costs over the next 12 months. Pennsylvania utilities can only adjust its rates quarterly based on changes in its wholesale gas supply costs. The supply charges are passed along without any markup for profit and make up about 80 percent of PECO's total rate for gas service.

The $1.28 per ccf consists of $1.00 per ccf for gas supply and 28 cents per ccf for PECO's delivery of gas from the interstate pipelines that bring gas from the Gulf of Mexico to local customers. While gas supply charges fluctuate each year based on the wholesale market, PECO's distribution charge has been stable over the past 20 years. During that time, the company has invested about $60 million each year for distribution system maintenance, upgrades and expansion for 150,000 additional customers.

PECO said this rate would remain in effect at least through the next three months, which are the peak demand months for gas during the winter heating season. Any higher or lower market costs for purchased gas supply than the utility's forecasts will be reflected in future quarterly adjustments (March 1, June 1, September 1).

Based on figures from the federal Energy Information Administration, natural gas provides the best value for consumers this winter. Prices for other fuels used for heating are expected to be 20 percent or more over last year. PECO's new rate for natural gas rate is considerably lower than current prices for heating oil or propane. (EIA winter forecasts can be found at www.eia.doe.gov).

What customers can do: Customers are urged to be aware of and manage their energy usage during the months with the highest demand. To save money, PECO said consumers should get their heater cleaned and inspected at least every other year and change the heater filter regularly for optimal efficiency; get a programmable thermostat to set back the indoor temperature when sleeping or no one is at home; seal up cracks around the home's exterior with weather stripping and caulking; and install window plastic sheeting over drafty windows, if needed; insulate older water heaters; and install a high efficiency shower head to save water and water heating costs. PECO also has arranged for a 20 percent discount on energy efficiency products that its customers purchase online through the Energy Federation Inc. Visit pecowinter.com for a link to the online energy store. PECO receives none of the sale proceeds.

PECO customers also can sign up for budget billing to spread out the higher winter costs throughout the year. Customers can enroll online at www.pecowinter.com or by calling customer service at 215-494-4000.

Customers who struggle paying utility bills should contact PECO for information on assistance programs. Qualifications are based upon family size and income. PECO's LIHEAP hotline is 1-800-34-HELP-4, or 1-800-344-3474. Customers may also be eligible for discounted rates, weatherization assistance, and other programs.

PECO delivers natural gas to 480,000 residential, business and institutional customers in southeastern Pennsylvania in the suburban counties surrounding Philadelphia. The company delivered 76 bcf of gas in 2006.

Based in Philadelphia, PECO is an electric and natural gas utility subsidiary of Exelon Corporation (NYSE:EXC). PECO serves 1.6 million electric and 480,000 natural gas customers in southeastern Pennsylvania. Founded in 1881, PECO is one of the Greater Philadelphia Region's most active corporate citizens, providing leadership, volunteer and financial support to numerous arts and culture, education, environmental, economic development and community programs and organizations.

Source: Business Wire

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