A mild winter of 2011-12 has lead to a glut on the natural gas market and expected low prices in the foreseeable future.
SPRINGFIELD — Despite Columbia Gas of Massachusetts’ request for a rate increase, the average bill for a home-heating customer who also cooks with gas is expected to fall $15 a year from $1,268 a year for November 2011 to October 2012 to an estimated $1,253 for the fiscal year starting in November.
That’s because gas bills, like electricity bills, are based both on the cost of the energy and on the cost of getting that energy to consumers’ homes, said Sheila A. Doiron, director of communications for Columbia Gas. That’s why any increase in the cost of distribution is offset by falling commodity prices for gas.
A mild winter of 2011-12 has led to a glut in the natural gas market and expected low prices in the foreseeable future. Proposed gas commodity costs for customers for the summer season effective May 1 are 31 percent lower than last year, according to Baystate Gas.
Columbia Gas has asked the Massachusetts Public Utility Commission for permission to raise its base rate, the distribution and administration charge, $6.10 per month, or 5.8 percent, in November. The request can’t go forward without approval from Department of Public Utilities. A public hearing on the matter is set for May 23 at 7 p.m. at the School Committee Chambers in Springfield City Hall, 36 Court St.. Other public hearings are scheduled for May 22 in Brockton and May 24 in Lawrence.
Formerly called Bay State Gas, Columbia Gas of Massachusetts distributes natural gas to about 300,000 customers in 60 communities throughout the state.
The base rate hike is designed to raise $29.2 million a year in additional revenue. That revenue will be used to replace aging infrastructure, including outmoded steel and cast iron gas mains installed during the building boom that followed World War II.
Doiron said gas is still a bargain. With all the rate fluctuations, the price of gas is going from $1.31 to $1.30 per therm, a measurement of gas. Converted to BTU’s, that works out to paying the equivalent of $1.82 a gallon for home heating oil.
Heating oil is selling for $4.06 a gallon, according to the state Department of Energy Resources.