AGL Resources subsidiary Chattanooga Gas said last week that its utility ratepayers will receive about $1.8 million in benefits from a utility asset management contract with affiliate Sequent Energy Management.
The benefits in 2004 were about 50% greater than those achieved the year before and will be shared with customers throughout the remainder of 2005 in the form of reduced gas costs, which amount to an annual average savings of $30 per customer, the utility said.
"The $1.8 million reduces the overall gas costs for our residential and small business customers," said Steve Lindsey, vice president of Chattanooga Gas. "The reduction will not appear as a line item on the gas bill but will be reflected in the gas cost calculation applied to the customer's bill."
Sequent has managed Chattanooga Gas' assets since May 2001, with the goal of optimizing its utility assets and sharing the savings with customers. The asset management company says it uses its market knowledge and expertise to help customers capture value from idle or underutilized assets and to balance the needs of various markets and time horizons.
"Asset managers who focus on optimizing physical assets on behalf of customers are playing an increasingly vital role in the way utilities manage their businesses," Lindsey said. "These savings at Chattanooga Gas illustrate the value that can be added to the business and the customers that are served."
Sequent Energy manages all of the upstream transportation and storage assets of AGL Resources' utility subsidiaries: Atlanta Gas Light Co., serving more than 1.5 million residential, commercial and industrial users in Georgia; Virginia Natural Gas with more than 230,000 customers in southeastern Virginia; Elizabethtown Gas serving 260,000 customers in New Jersey; Elkton Gas, serving 5,100 residential and business customers on Maryland's eastern shore, Florida City Gas, serving 101,000 residential and commercial natural gas customers in Florida's Miami-Dade and Brevard counties; and Chattanooga Gas, which provides retail natural gas sales and transportation services to 60,000 customers in Tennessee. The Chattanooga Gas pipeline system delivers 20 Bcf/year of gas.
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