While the real price of other goods and services in the U.S.increased by 34% since 1987, the price of natural gas to consumershas decreased by an average 14%, from 1987 to 1997, according to areport used by the American Gas Association to show FERC thatretail unbundling is working. The distributors’ group told afederal/state regulatory policy conference Thursday the price toconsumers went from an average $4.47/Mcf in 1987 to $3.85 in 1997(all in 1997 $). Of that delivered price the total transportationand distribution cost to consumers went from $2.23 to $1.53, a 31%decline, AGA said, citing surveys by the Energy InformationAdministration. During the same period the wellhead price wentfrom $2.24 (in 1997 $) to $2.32 in 1997.

Credit goes to the introduction of competition into thedistribution and transmission sectors since the Federal EnergyRegulatory Commission issued Order 636 and states moved towardunbundling. A separate AGA report shows 34% of residentialcustomers (18.5 million customers) will have a chance to purchasegas from a non-utility supplier under distributor pilot or fullservice programs in operation or being phased in by 2000. Thiscompares to 90% of large customers and 40% of commercials.

AGA reported on 44 distributor choice programs underway in 21states and Washington DC. An LDC survey shows on average three tofive marketers are actively soliciting residential customers wherethere is customer choice, while an average 11 to 17 marketers areinvolved in commercial customer programs.

©Copyright 1999 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.