Citing decreasing prices for natural gas, Delmarva Power applied for approval from the Delaware Public Service Commission to lower its supply charges for gas customers by 18 percent from the current rate, beginning in November.
Based on this adjusted rate, a residential gas customer, using an average of 56 CCF per month, would see a total monthly bill decrease of $16.30.
The natural gas supply charge, also known as the Gas Cost Rate, is a direct pass-through cost to customers with no markup and is typically adjusted annually but may be adjusted during the year due to rising or falling market prices. Delmarva earns its profits from servicing a natural gas system that covers northern New Castle County.
Natural gas are abundant, thanks to Marcellus field in Pennsylvania, and worldwide natural gas prices have fallen as fears eased about the impact of the the Russian invasion of Ukraine.
“This is the second reduction in gas costs in the past eight months and comes at an important time as we transition to a time when customers begin to use more gas, especially those customers who use gas for heating their home or business,” said Doug Mokoid, Delmarva Power region president. “We are constantly focused on providing more than safe and reliable energy service for our customers. We are also taking major steps in our efforts to help maintain affordability for customers, including connecting customers with energy assistance and helping customers take important energy efficiency steps that can reduce their usage and their energy bills.”
As part of the company’s effort to reduce the impact of increases in gas supply costs, Delmarva Power purchases and stores about half of the natural gas needed to meet its winter demand in the summer months when prices are generally lower.
Locking in prices, also known as hedging, seeks to limit the impact of wholesale price volatility that may occur throughout the year.