Natural Gas Pipeline Cost Update

What is this increase from the pipeline that serves KUB?

East Tennessee Natural Gas (ETNG) pipeline, owned by Enbridge, Inc., filed for a rate increase with the Federal Energy Regulatory Commission (FERC). These rates went into effect January 1, 2021 and will be reflected on the next invoice ETNG bills to KUB.

How much is this natural gas cost increase?

The estimated increased annual cost to KUB is $7.7 million. This additional cost will be passed on to our customers. For a typical residential customer, this represents approximately $48 annually, or approximately $4 per month.

Will business (commercial) customers see an increase on their bills as well as residential customers?

Yes, all firm gas customers will share in the increased cost.

Why does KUB pass along this increase to its customers?

All changes in wholesale costs, whether for pipeline costs or wholesale natural gas cost, are passed to our customers through the Purchased Gas Adjustment mechanism (PGA).

What portion of my total natural gas cost does this increase impact?

This impacts the rates per therm charged to customers. The basic service charge is unaffected by this wholesale cost increase.

What happens when the pipeline lowers costs to KUB? Does KUB lower my bill when the pipeline cost goes down?

Yes – we pass along all change in cost, whether related to pipeline or supply, to our customers through the monthly Purchased Gas Adjustment (PGA). If the cost goes down, our customers will benefit from the savings.

Can KUB customers expect to see increases like this often?

We cannot predict when our pipeline providers or natural gas wholesale suppliers will change costs. Any change in cost, increase or decrease, from these outside entities is passed directly to our customers without any additional markup.