Terasen to cut natural gas rates

By Jeff Nagel - BC Local News Published: September 05, 2008

Households that use natural gas can look forward to lower rates this fall. Terasen Gas is proposing to lower its commodity rate on natural gas by almost 19 per cent to $7.92 per gigajoule (GJ). If approved by regulators, the new rate will take effect Oct. 1 and be the lowest price consumers have paid here since February. Terasen had jacked rates first to $8.29 per GJ in March and then to $9.78 in July to keep pace with soaring energy prices this year. Now oil and gas prices are in retreat and Terasen officials say their quarterly rate adjustment will ensure customers benefit in time for the winter heating season. "Strong production levels in the U.S., a mild summer across most of the continent and a hurricane season that has not resulted in any significant gas production disruptions to date have enabled storage balances to rebound and prices to fall from the highs of early July," said Terasen Gas vice-president Cynthia Des Brisay said. Terasen passes on the commodity cost of natural gas to customers without markup. It makes its profit on separate charges for delivery, storage and account handling.

The typical Lower Mainland home should see an annual saving of about 12 per cent – or between $177 and $204 – off their entire bill as a result of the October reduction. The rate cut applies only to customers who stayed with Terasen Gas as their supplier. Those who signed fixed-price contracts from independent gas sellers remain locked in at those prices – mostly between $9.25 and $11 per GJ. All natural gas customers are also now paying B.C.'s carbon tax, worth 50 cents per GJ.