As leaves begin turning colors and temperatures start dropping, utilities across the country have been warning their customers that higher heating costs are in store this winter. Joining the ranks Wednesday, PECO said it will raise its natural gas rate by a “significant” amount on Dec. 1 to reflect the sharply higher cost of buying gas in the wholesale market in the aftermath of Hurricanes Katrina and Rita in the Gulf of Mexico.

The Philadelphia-based utility pointed out that even before the hurricanes, gas was selling wholesale at prices much higher than a year ago due to the steadily rising use of natural gas nationally, especially for power generation in the summertime.

While the amount of the change in the gas commodity price won’t be finalized for a few more weeks, PECO said the increase will be significant based on the dramatic rise in supply costs. Residential heating customers in Pennsylvania could pay $75-100 more per month than last winter.

“We are concerned about the impact the higher rates will have on our customers, and we urge anyone who may have trouble this winter to contact us soon,” said PECO President Denis O’Brien. “Now is the time to prepare so homeowners can become more energy efficient and better manage their energy costs this winter.”

PECO said it has arranged for sufficient gas supplies to meet winter demand for its “firm” customers. “Despite various strategies for buying supply at least cost, the prices have been much higher than years past,” O’Brien said, noting large quantities of gas placed into storage prior to the hurricanes. Generally, PECO buys about 65 Bcf of gas for its retail customers and buys under varied contract terms to “hedge” against rising prices.

PECO urged customers to conserve energy and operate their home efficiently in order to keep costs down. In addition, the company also noted that its budget billing plan and customer assistance program can help customers through the winter. For more information, visit

The subsidiary of Exelon Corp. serves 1.5 million electric and 460,000 natural gas customers in southeastern Pennsylvania.

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