Citing the mild hurricane season, increased U.S. natural gas production and its “proactive procurement” program, Baltimore Gas and Electric Co. (BGE), a utility subsidiary of Constellation Energy, announced last week that its residential customers can anticipate a 15% decrease from last winter in the gas portion of their total bill during the upcoming winter heating season, which begins Nov. 1, 2006 and runs through March 31, 2007.

BGE’s message was similar to a host of others from utilities across the country in recent weeks heralding lower gas prices. Atmos Energy, the nation’s largest gas-only utility holding company, also said Tuesday that it expects lower winter gas prices and residential customer gas bills this winter.

According to Baltimore-based BGE, assuming a normal winter, a typical residential heating customer in its service territory can expect to pay approximately $665 during the heating season, compared to $773 for the same period a year ago.

“This is very welcome news for our customers,” said Mark Case, BGE’s vice president of business performance, strategic and regulatory services. “BGE customers are benefiting from lower natural gas costs because of the mild hurricane season, an increase in U.S. natural gas drilling, and the filling of natural gas storage fields ahead of schedule.”

With a little less than a month still left in the traditional storage injection season, the country’s 3,389 Bcf easily surpassed the weekly storage report record of 3,327 Bcf, which was recorded for the week ended Nov. 5, 2004. The Energy Information Administration’s (EIA) weekly storage report records go back to December of 1993.

Delving deeper into EIA’s monthly storage report records, stocks are just shy of the 3,467 Bcf in storage at the end of October 1990 and the all-time record posted at the end of November 1990 of 3,472 Bcf. In its October 2006 Short-Term Energy Outlook, the EIA predicts that end-of-October levels will reach 3,538 Bcf.

The EIA said last Tuesday that on average U.S. households heating primarily with natural gas will spend about $119, or 13%, less this winter in fuel expenditures compared to last winter (see related story). This contrasts with an anticipated $91 increase this winter for households heated with heating oil, a $58 hike for households heated with electricity, and a $15 drop for propane-heated households. The EIA noted that residential gas prices, which were hardest hit by last year’s twin hurricanes, are expected to average $12.23/Mcf this winter, down 16.4% from $14.64/Mcf a year ago.

The situation might even end up being better than anticipated for consumers if winter weather predictions are accurate. The National Oceanic and Atmospheric Administration said Tuesday that it expects a warmer-than-normal winter nationwide (see related story).

However, BGE warned that winter cold snaps and other events could cause natural gas prices to increase. In planning for “this type of volatility,” BGE said that approximately half of the winter supply has been secured at a known price, which would help to moderate any increases required during the upcoming heating season.

Even with the lower gas bills, BGE said it has programs in place to help some customers who are still “challenged” by their heating bills. “BGE’s Budget Billing program is a good choice for many customers because it spreads out the impact of higher winter heating bills, and we also strongly advise limited-income customers to apply for energy assistance now before they find themselves falling behind on their heating bills,” said Johnny Magwood, vice president of customer relations and field services for BGE.

BGE delivers electricity to more than 1.1 million residential and business customers. It operates 250 substations, 22,500 miles of distribution lines and 1,300 miles of transmission lines. On the natural gas side, BGE delivers gas to 600,000 customers. It operates two peak-shaving plants, nine gate stations and 6,000 miles of gas main.

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