Gas Cost Adjustment FAQ

What is the Gas Cost Adjustment?
Equitable Gas is required to sell our natural gas commodity without profit. It is difficult to predict the changing cost of gas and the changing usage patterns of our customers. Equitable Gas often sees a difference between the cost of gas purchased and the amount recovered from customers through the commodity rate. The gas cost adjustment is a charge that is a true up for this difference. The gas cost adjustment can be a charge or a credit, depending on recent market conditions.
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How can you over-or undercharge for gas when your rate can change every quarter?
Equitable Gas is required to sell natural gas commodity to residential customers without profit. We set our gas rate in October; however, we purchase gas at market prices every day…and that price changes just as often. We may raise or lower our rate quarterly based on the market price of gas at that time; it does not represent the day-to-day price changes we experience.
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How Do You Apply This Adjustment?

We calculate any difference between the rate charged and the prices paid and divide it by the amount of gas purchased. We then spread this difference over the price of gas sold over the next year.

  • If the rate "over collects" the price we pay, the gas cost adjustment will be a credit, or subtracted from the cost of gas.
  • If the rate "under collects" the price we pay, the adjustment will be added to the cost of gas.
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