Business

Natural gas rates drop

Natural gas rates are going down again. - File
Natural gas rates are going down again.
— image credit: File

Falling natural gas prices should save the typical gas-heated household $66 next year, according to Terasen Gas.

Bills are projected to total $1,009 annually, down more than six per cent from $1,075 in 2010.

Lower rates for natural gas were approved this month by the B.C. Utilities Commission and take effect Jan. 1.

The price drop is due to a glut of natural gas on the market, continued strong production and lower than expected demand.

Terasen passes on the commodity cost of the gas without markup, instead earning its profit on the separate delivery charges to transport it.

Not benefitting from the low prices are those households that locked in to long-term rates offered in 2007 by rival gas marketers who are reaping big profits.

Most of those customers are a year away from escaping from their contracts, which force them to pay rates that are now at least double Terasen's new fluctuating rate.

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