Fixed rate Natural Gas promo recieved in our mail today from our gas supplier...

H.G.P. · 10-20-2005, 09:55 AM

They are offering this to fix our natural gas rate at $15.29 per mcf per month through Dec. 2006.

But I'm suspicious of this, as I calculated last years months at this rate, and +/- our own conservation measures (extra caulking, cutting back on natural gas usage etc.,), I don't see the savings, if anything a loss of $ for us.

Anyone have the inside information on these promotions?

Thanks

RickM · RickM's Garage

The price of NG is supposedly going to skyrocket. Not sure if the utilities are allowed to raise more than a certain percentage each year though.

This morning I heard an ad for 1-800-I-Got-Gas for a 3 year pre-purchase program.

H.G.P. · 10-20-2005, 10:28 AM

I can understand the gasoline hike, but I can't in the natural gas one.

Three years?

RickM · RickM's Garage

Isn't NG a byproduct of refining crude?

red-beard · red-beard's Garage

Thank the greens. They pushed a super stingent emmision requirement for new power plants and now old ones have to meet it as well. You can't do this wil coal, only Natural Gas, so...gas is in demand to make electricity.

THIS IS STUPID.

Oil should be reserved for making plastics

Natural Gas Should be reserved for Vehicles

Coal and Nuclear should be used for making electricty

gaijindabe · 10-20-2005, 10:52 AM

Quote:

Originally posted by H.G.P.

Anyone have the inside information on these promotions?

Aren't they basically buying Natural Gas futures at a fixed price and so can guarantee the price? The price may very well go down, or go way up. I guess it helps some folks sleep at night.

legion · 10-20-2005, 11:01 AM

I had a friend do one of these contracts 2 years ago for a three year period. She just got a letter in the mail stating that because NG prices are going up, they are voiding the contract. She paid more for NG when prices were low, thinking she would be protected if they went up dramatically.

My opinion of these types of deals (budget plans also) is that the gas companies are fine with them as long as they are in their favor, but will weasle out when it is in your favor.

I just pay my actual usage at market rates month-to-month.

MotoSook · 06:37 PM

I work in in the natural gas industry...and when I get those calls or notices...I tear them up....they don't like it when I start asking THEM questions when they try to sell me a contract

Even at 1.5X the current cost of natural gas, it is still relatively cheap to heat your house. Think about it. Your total natural gas bill for the year is what? $500, $1200 or $2500? And do you think $2500 is expensive to keep warm? How much do you pay for non-essentials? How much do you spend at Starbucks? How much for gasoline to go shopping for non-essentials?

Conservation is your best friend. Get a timed T-stat for the house. Keep the kids from running in and out of the house to play in the snow.............does your house really need to be 78 degrees? 70 is good with winter attire, right?

strupgolf · 10-20-2005, 06:02 PM

.Working in the gas industry years ago, I would think this is not the thing to do. Yes, natural gas prices are up, because of hurrican's etc., but they will come down in the future. After all the stuff gets fixed up in the delta, supplies will be tight because of all the utilities using gas for everything, but they will come down. There is plenty of gas now and yet to be discovered, enough for 100 or more years. Like Souk said, button the hatches guys.

MotoSook · 07:00 PM

Here's another angle: a few years ago, I could have easily bill 100 hrs/week building facilities to feed fuel to nat. gas burning power plants. Millions were spent to beat the competition to get generation plants built so they could capitalize on the favorable electric rates....then everything came to a halt. Some plants were even called off after money had already been spent on preliminary studies. Some plants sat idle for more than 50% of the time (and a lot still do, but they make money during peak periods..Peakers). (Let's not even talk about California...they created their own problems, then when things fell apart looked to point fingers)

The American life style helps boost the cost of things we buy, then when we pause to realize the price increase we scream for federal intervention. The ratio of income to dollars spent on essential goods is probably very favorable for Americans. So much so that a lot of folks can afford to drive around in big luxurious vehicles, pay for multiple cars and Porsches as toys

If you went to another country and told folks that you spent the kind of money we spend on our toys or better yet, the money we spend to play with our toys at the race track; then in the same breath b!tched about the cost of fuel and energy, you'd probably get funny looks.

But what do I know, I've been living the fat, dumb and happy American life style long enough.

RickM · RickM's Garage

Good points Souk.

I especially think conservation is a great tactic as well.

Looks like the hot commodity now is coal.

gaijindabe · 10-21-2005, 05:44 AM

Who heats with coal at home? Either in the basement as a substitute for oil/gas -or- with a coal stove in living areas?

RickM · RickM's Garage

It's not who uses it at home but how it's resurgence will influence the price of other fuels.

Rich76_911s · Rich76_911s's Garage

NG gas got creamed yesterday in the futures market because the US reservers were higher than expected. It was trading at 12.50 or so, I think. If you want to know the current price of NG on the futures market go here:

http://www.bloomberg.com/markets/commodities/energyprices.html

Don't know where it is going to go in the future though. If I did I would be bothering the heck out of pelican and motomotions about getting my car to go silly fast! One thing to look for is if the Natural gas lines come back online from the hurricanes in the south we could have more supply than we need.