Dominion East Ohio (DEO) said this week that it once again expects natural gas production from the Marcellus and Utica shales to help provide ample supplies and lower prices for its customers during the winter heating season.
While it said the same at this time last year, the company's standard rates for the season have been cut by more than half since then. DEO said its current standard choice offer (SCO) is $2.226/Mcf, or 53% lower than its December 2014 SCO rate of $4.712/Mcf. Rates have plummeted since February 2014, when much of the country experienced one of the coldest winters in decades. DEO'S SCO rate at that time stood at more than $6/Mcf (see Daily GPI, Dec. 15, 2014).
The SCO is available to eligible residential customers who have not already chosen a supplier or opted to join a governmental aggregation program under Dominion's Energy Choice program.
Under the current rate, the average SCO residential customer's bill for December 2015 would be about $66.12, or nearly 40% less than the $109.92 the average customer paid in December 2014. The company said an average customer's bill in December 2010 was more than double this year's rate at about $151.
"One of the major drivers of our supply security is increasing natural gas production right here in Ohio," said DEO Vice President Jeff Murphy. "Even though demand continues to grow, as more natural gas is used for electric generation and our economy continues to recover, increased regional production has resulted in lower market prices."
Current weather forecasts project a milder winter than the previous two years, in which colder-than-normal temperatures prevailed. Natural gas recently hit record low cash prices in the Northeast, falling below $1 last week for the first time such a level has been reached during the winter months, according to NGI historical price data, while prices across the rest of the country have remained low, too (see Daily GPI, Dec. 28)
DEO is a subsidiary of Dominion Resources Inc., one of the nation's largest producers and transporters of energy. The company serves about 1.2 million gas customers in northern, western and eastern Ohio.