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Natural Gas Prices Change (Again)

Barely a month after learning that our natural gas bill would be going up (WAY UP) yet again, we just received another letter from the gas company notifying us of a price change. This time, however, it was welcome news. It seems that gas prices have dropped sharply in recent weeks, and that our monthly payment under the gas company's 'Equal Payment Plan' (EPP) will be dropping as a result. By more than half! That's right, our $146 monthly bill is falling to $68. In other words, after experiencing a total of 85% in price increases since last summer, our bill will now be 14% below where it was when all of this madness started. Now I'm not one to complain about price cuts, but all of these fluctuations sort of make question why they refer to this as an EQUAL Payment Plan.

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Comments
>>> D-man Commented on March 02, 2006

The problem is with the price of Natural gas going from $5 per BTU to $15 and back to $7, its pretty much impossible to come up with an equal pay plan that would be likely to represent that actual average cost over the season. Equal pay really only works with fairly steady prices and even then the uneven nature of use dictated by weather can have a dislocating influence. But when you add weather with huge price fluctuations, it is really not a concept that works.

I think these plans were designed to make people's lives more predictable who couldn't budget for the large fluctuations in the bills and give the utility companies some protection because the customers would be less likely to be delinquent if the bill was always the same. Since My reserve cash is always plenty able to cover any fluctuations in bill, I have never seen any reason to use these plans. Seems like an extra hassle to end up with the same amount paid over a 12 month period anyway.

Just curious for the people who use these plans what their reasons are?



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