Hannah Bozian AGA Analysis of the 2010-2011 Winter Heating Season

Colder Temperatures Can Affect What You Pay For Natural Gas

As painful as it may seem, it is never too early to be thinking about winter heating…or is it?

On June 29, 2011, AGA released an energy analysis of the 2010-2011 winter heating season. Each year local natural gas utilities develop a plan to reliably meet customer needs during winter heating season peak consumption periods. 

For this year’s survey, questions focused on peak-day and peak-month supply practices, pricing mechanisms, as well as regulatory and market hedging practices. To maximize efficiency, all of the companies surveyed indicated that they use storage services to satisfy demand, especially considering the unexpected weather patterns. Storage services help manage the gas supply and transportation portfolio efficiently, and in a way that reduces costs, which is what everyone wants. 

The report discusses how winter temperatures play a significant role in supply planning as well as consumer bills. During the winter months, natural gas customers consume more gas than usual, so it is necessary to look at the trends that may affect your wallet.

Last year, while October and November were warmer than previously recorded averages, December, January and February were colder than normal.  For the companies surveyed, their peak months for gas usage were almost evenly distributed among these coldest three months (13 companies had their peaks in December, 18 in January, and 15 in February). Gas companies have to determine their supply of gas based on their projected peak consumption levels so they have enough gas for all of the customers, and can deliver it in a timely manner.

If you would like to learn more, please contact Lydia Meigs, lmeigs@aga.org.

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