Ask Jane Campion what she remembers about last winter and one thing immediately comes to mind. “The weather was absolutely frigid. I didn’t even want to leave the house,” said Jane, who lives in Bayonne with her husband, Jack, both retired teachers.
But the Campions also remember something else about last winter. Their heating bills were noticeably lower than previous years – even though they used more gas to heat their two-story home as a result of the colder weather.
“Years ago, my PSE&G bill for both gas and electricity was about $400 or more a month during a really cold winter,” Jane recalls.“This past February, my total bill was only $261 – with $190 of that for gas. My bill included a credit of almost $89. I call that quite reasonable –and our house was nice and warm.”
Part of my job at PSE&G is to make sure we have enough natural gas on hand so that our 1.8 million gas customers – including the Campions — can heat their homes, take a hot shower and cook a meal on even the coldest of winter days. To do that, we purchase gas all year long (even during the summer), pump a lot of it into storage and effectively manage our pipeline and transportation contracts so that we can meet customer demand four months from now when summer’s warmth is merely a sweet memory.
Although we do a good job, I know that our customers expect more from their local utility. They also want us to keep the cost of that gas as low as possible so that their monthly gas bills are also as low as possible. I am pleased to say we have been able to meet that challenge.
Since 2009, the price of natural gas has been on the decline, thanks largely to additional reserves that are available from the Marcellus Shale Formation in Pennsylvania. As the largest gas utility in the state, PSE&G purchases significant quantities from these nearby reserves. Over the years, we have compiled an extensive portfolio of pipeline assets that are accessible to lower cost gas supplies in the region. As a result, we can acquire low-cost, reliable gas supplies and leverage our buying power to pass along those savings to our residential customers who buy their supply from us.
Our customers like Jane and Jack Campion are reaping the benefits. Reductions in the cost of natural gas supply have lowered residential gas bills by about 44 percent – saving the typical customer about $741 annually. Since 2012, we have also provided monthly winter bills credits totaling $433. Costs for gas supply account for about half a customer’s monthly bill.
We have proposed even more savings this fall. In a recent filing made with state regulators, the price per therm of gas would drop to 40 cents – the lowest price in 15 years. I can’t think of another commodity that costs less today than it did in 2000. The new price would take effect October 1, just in time for the winter heating season and would save the customer another $51 annually, bringing the total savings since 2009 to 47 percent.
Although we have done our best to keep bills low, we know that some customers will still struggle to heat their homes. That’s why we provide simple, yet effective energy conservation tips to lower usage and bills. We also partner with state and local agencies to spread the word about a variety of payment assistance programs for low-income customers, as well as those with larger paychecks who may just have recently fallen on hard times.
Of course, no one can predict what will happen to energy costs in the future. But for now, one thing is certain – keeping warm on a cold winter’s day has never been more affordable.