Natural Gas Market Prices May Ease Winter Bills
Cedar Falls Utilities customers may experience more moderate natural gas market prices this heating season which will help ease utility bill costs.
Natural gas market prices have declined since peaking in the second half of 2022. This has allowed utilities such as CFU to purchase natural gas that is provided to customers at a lower rate.
Preliminary projections forecast natural gas market prices will remain lower this winter than the previous two heating seasons.
In addition, the cost to transport gas to Cedar Falls will be significantly less than last year.
In January 2023, natural gas pipeline transportation fees increased significantly due to a temporary rate increase put in place by the pipeline company. The Federal Energy Regulatory Commission (FERC) approved a final pipeline transportation rate this summer at a much lower level than previously implemented resulting in reduced pipeline costs. The reduced pipeline transportation fees will carry forward into winter bills.
The market cost of gas and related transportation fees make up the Purchased Gas Adjustment (PGA) on CFU utility bills. CFU does not mark up this cost, it is simply a pass-through to customers. If gas market or transportations costs go up or down so does the PGA.
With costs predicted to be more moderate this season, customers should see this reflected in the PGA on winter gas utility bills.
Utility bill impacts will vary by customer usage, winter temperatures and continued market fluctuations.
CFU has agreements in place that shield customers by reducing price volatility, including locking in a portion of our gas supply at a fixed price.
Learn more about residential natural gas utility rates and how they are calculated here.