Dec 07, 2012 by Alagasco

Understanding what you pay for natural gas

Categories: Alagasco News

In light of some recent news reports that have attempted to compare the rates of several different natural gas utilities on an apples to apples basis, we’d like to address the reliability of that approach. A comparison like this isn’t really accurate unless you know everything that goes into calculating the rates.


This can be a complex issue, and we’d like you to hear about it directly from us.


  • Rates are made up of a multitude of factors that are specific to each utility company. And many of these factors are often out of the utility company’s control… weather, access to pipelines, taxes and other issues. We can’t speak to what other natural gas utilities charge their customers because we don’t know what factors into their rates.  But, we are proud of the work our employees do every day to provide you – our customers – safe, reliable service at a fair price.


  • We understand that there may be some misunderstanding over the idea that Alagasco is guaranteed a profit. That’s not the case at all. The Alabama Public Service Commission set a profit range for all the utilities it regulates, including Alagasco. The Rate Stabilization and Equalization allows Alagasco an opportunity to earn a profit of up to 13.65 percent. The goal of the RSE is to stabilize rates while allowing Alagasco the financial base to grow.


  • Over the past four years, Alagasco has had seven gas cost decreases which amount to an annual savings of $270 for the average residential customer compared to rates in effect in October 2008. And since October 2000, the average annual bill for our residential customers has decreased 8.5 percent.


One last thing…we appreciate the opportunity you’ve given us to serve your home or business. The benefits of natural gas, like reliability, comfort and efficiency, continue to make it the best energy choice and a great value. Thank you for considering the facts.



Alagasco, your natural gas partner, provides clean, energy efficient natural gas to approximately 437,000 homes, businesses and industries in central and north Alabama. To report a gas leak, a line break, or any other gas service emergency, please call 1-800-292-4008. For other inquiries about your account, service or billing, you can reach us via email or phone.

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