The Kentucky Public Service Commission (PSC) is seeking comment from residential and small-volume commercial customers and others who would be affected by broader retail competition in the state’s natural gas markets.

A measure enacted earlier this year by the Kentucky General Assembly directed the PSC to study whether retail competition would benefit the state’s small-volume gas consumers.

Currently, retail gas service in Kentucky is provided by companies that own and operate local distribution systems. The local distribution companies (LDC) purchase gas on the wholesale market and resell and distribute it to their customers, charging delivery and other fees that are regulated by the PSC. The wholesale cost of natural gas is unregulated, but must be passed on to consumers on a dollar-for-dollar basis by the state’s LDCs — Atmos Energy Corp., Columbia Gas of Kentucky, Delta Natural Gas Co., Duke Energy Kentucky and Louisville Gas and Electric Co.

Under retail competition, customers purchase gas from third-party marketers, LDCs deliver the gas and customers continue to pay associated costs to the local company. Kentucky law neither requires nor forbids retail competition for small-volume customers; federal law requires that large-volume customers have open access to gas suppliers.

Only one LDC — Columbia Gas of Kentucky — has implemented a voluntary retail competition program for residential and small commercial customers, according to the PSC.

The PSC has scheduled an Oct. 19 hearing in the case and will accept public comment through that day.

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