Understanding Natural Gas Transport Critical Days
Natural gas transmission pipeline operators issue Transport Critical Days when transmission pipelines are under stress and they begin enforcing firm entitlement limits more strictly throughout a region. Natural gas becomes significantly more expensive to purchase and transport during these times, because it may come from other sources or dip into reserves. This can happen for a variety of reasons, but it usually has to do with extreme cold weather or pipeline restrictions.
How will this impact me?
As a not-for-profit cooperative, our rates reflect the costs we pay for the wholesale natural gas we provide to you, or the “commodity.” This means that we never charge extra on the gas commodity to make a profit, but it also means that when our costs increase, your costs increase as well.
Members like you can help keep the average cost for the month down by conserving gas during these Transport Critical Days. Simply reducing your thermostat setpoint by a few degrees can make a big reduction in your energy usage and reduce the amount of higher cost gas purchased by URE. The less wholesale gas URE must purchase during Transport Critical Days, the less impact the added costs will have on monthly bills.
Because we pass our monthly wholesale costs directly to our members, any increased Transport Critical Day costs will appear on your bill the next month as an increase in the average commodity rate.
The “commodity” line in your next natural gas bill will include any higher cost incurred during these Transport Critical Days. Please note that this does not affect the local distribution charge for natural gas.
What can URE and its members do about this?
The best way for our members to keep costs down during Transport Critical Days is to take steps to use less natural gas so that we purchase less gas at the elevated rates, ultimately reducing the increase to the average monthly rate.
Of course, URE does a lot to keep gas rates stable, including:
- Holding rights to natural gas storage capacity which helps to keep costs from spiking.
- Holding a certain amount of “firm capacity,” which gives us the first right to gas from the transmission pipeline company.
- Pre-purchasing a certain amount of gas annually to lock in pricing while still taking advantage of market pricing when it is beneficial.
We understand that keeping energy affordable is a priority for our members. We will continue taking opportunities to reduce the price risk of Transport Critical Days, but it is always helpful to work together as a Cooperative to reduce their impact through conservation.