Enough already about doggies!
Long-time posters know that I watch natural gas prices and try to enter into contracts with suppliers when the price seems right. I have shared what I know with Observers and will continue to do so. It costs us more and more every winter to heat our homes and anything we can do to reduce that cost is certainly worth an effort.
A month ago, 1 million BTUs of natural gas cost over $13 wholesale. Now it is just under $10. That's about a 25% reduction. Hopefully the lower wholesale prices will soon be reflected by what is offered to us by the third-party suppliers.
See http://www.puco.ohio.gov/Puco/ApplesToA ... fm?id=4810 but these prices don't yet reflect the lower wholesale price.
My contract with MxEnergy ends in the fall so I am keeping my eyes open. You should too, particularly given the big reduction in prices.
Remember that you can buy natural gas on the New York Stock Exchange by way of United States Natural Gas LP (ticker symbol UNG). UNG tracks the spot price of natural gas and was at 64 about a month ago but has fallen to about 47 now, again almost a 25% decrease. If you want to lock in today's natural gas price for your winter heating bill, and if like me your contract is not yet up, you could buy some UNG, then sell it when you do sign a contract with one of the suppliers.
At any rate I will keep you posted.
Natural gas, finally some good news?
Moderator: Jim O'Bryan
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Tim Liston
- Posts: 752
- Joined: Sun Aug 07, 2005 3:10 pm
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John Walsh
- Posts: 4
- Joined: Wed May 16, 2007 6:51 pm
Tim,
I have NOPEC/Dominion for my supplier at a cost of $9.95 mcf, am I missing something, everything I see is quite a bit higher than what I'm paying, what gives?
To be honest I've never paid very close attention to it because the mcf cost on my bill has always seemed lower than what I see online.
Any info would be appreciated.
I have NOPEC/Dominion for my supplier at a cost of $9.95 mcf, am I missing something, everything I see is quite a bit higher than what I'm paying, what gives?
To be honest I've never paid very close attention to it because the mcf cost on my bill has always seemed lower than what I see online.
Any info would be appreciated.
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Tim Liston
- Posts: 752
- Joined: Sun Aug 07, 2005 3:10 pm
John I'm not on NOPEC so I really don't know that much about them.
Their web site says the rate is $9.95 through June 30, 2008. No further information. So I called and spoke with someone in customer service. She said the $9.95 rate was extended thru July 31 but will be revised (upward I presume and so did she) in August based on their next natural gas purchase, taking place around now.
$9.95 is a good rate right now and has been since last spring but it hardly matters in the summertime, which of course is why they could extend it. Maybe they had some gas left from their last buy.
By the way, you can't compare these rates with the wholesale rates I cited above. These rates are per mcf (thousand cubic feet) and the wholesale rates in my original post are per million BTUs. Because the numbers are similar it can be confusing. There are 1015 BTUs in a cubic foot of natural gas so the numbers are pretty close to interchangeable.
In order to get the NOPEC rate you first have to be getting your natural gas directly from Dominion East Ohio. Then you have to wait for an open enrollment period. Of course DEO is trying to get out of the natural gas business and become just a transmission company, piping somebody else's gas to your home. Who knows how that will impact NOPEC....
I hope this helps.
Edited to add: Natural gas fell even further today, closing at $9.68 per million BTUs wholesale.
Their web site says the rate is $9.95 through June 30, 2008. No further information. So I called and spoke with someone in customer service. She said the $9.95 rate was extended thru July 31 but will be revised (upward I presume and so did she) in August based on their next natural gas purchase, taking place around now.
$9.95 is a good rate right now and has been since last spring but it hardly matters in the summertime, which of course is why they could extend it. Maybe they had some gas left from their last buy.
By the way, you can't compare these rates with the wholesale rates I cited above. These rates are per mcf (thousand cubic feet) and the wholesale rates in my original post are per million BTUs. Because the numbers are similar it can be confusing. There are 1015 BTUs in a cubic foot of natural gas so the numbers are pretty close to interchangeable.
In order to get the NOPEC rate you first have to be getting your natural gas directly from Dominion East Ohio. Then you have to wait for an open enrollment period. Of course DEO is trying to get out of the natural gas business and become just a transmission company, piping somebody else's gas to your home. Who knows how that will impact NOPEC....
I hope this helps.
Edited to add: Natural gas fell even further today, closing at $9.68 per million BTUs wholesale.
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Mark Timieski
- Posts: 56
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- Location: Lakewood
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Tim Liston
- Posts: 752
- Joined: Sun Aug 07, 2005 3:10 pm
What is happening to natural gas prices?
As of right now, the wholesale price has dropped another $.56 (56 cents) to $9.23 per million BTUs. That's a drop of about $4 from the high of over $13 reached just three weeks ago. At one point today natural gas was down over $.80 cents. Amazing.
Also, the new “Apples to Apples†natural gas supplier price sheet just hit my in-box. It is published every Thursday. Here's a link:
Link to July 24 Apples to Apples Rate Chart (pdf)
I was curious to see if these suppliers have reduced their rates in response to the significantly reduced wholesale rates. So I fished around and look what I found:
Archived rate sheets all the way back through 2003
I printed the July 3rd sheet and discovered that most of the suppliers have reduced their rates since then, but not nearly by the same amount that the wholesale price has dropped. Most just a half a buck or a buck but nowhere near the $3.50 or so that that wholesale prices were down as of yesterday. So I certainly would hang in there and hope that these suppliers continue to reduce their rates. I presume they have to make purchases on the futures market before they feel comfortable offering significantly lower rates for a 12 month contract.
Oh and Mark like I said I'm not on NOPEC and not familiar with it. Presumably you are right and they are at $16 for July. Hopefully it won't be that high this winter.
As of right now, the wholesale price has dropped another $.56 (56 cents) to $9.23 per million BTUs. That's a drop of about $4 from the high of over $13 reached just three weeks ago. At one point today natural gas was down over $.80 cents. Amazing.
Also, the new “Apples to Apples†natural gas supplier price sheet just hit my in-box. It is published every Thursday. Here's a link:
Link to July 24 Apples to Apples Rate Chart (pdf)
I was curious to see if these suppliers have reduced their rates in response to the significantly reduced wholesale rates. So I fished around and look what I found:
Archived rate sheets all the way back through 2003
I printed the July 3rd sheet and discovered that most of the suppliers have reduced their rates since then, but not nearly by the same amount that the wholesale price has dropped. Most just a half a buck or a buck but nowhere near the $3.50 or so that that wholesale prices were down as of yesterday. So I certainly would hang in there and hope that these suppliers continue to reduce their rates. I presume they have to make purchases on the futures market before they feel comfortable offering significantly lower rates for a 12 month contract.
Oh and Mark like I said I'm not on NOPEC and not familiar with it. Presumably you are right and they are at $16 for July. Hopefully it won't be that high this winter.
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Bryan Schwegler
- Posts: 963
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- Location: Lakewood
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Bryan Schwegler
- Posts: 963
- Joined: Fri Jun 24, 2005 4:23 pm
- Location: Lakewood
Oh and since we're on the topic, just a preview of what's coming to us in Dominion-land:
http://blog.cleveland.com/business/2008 ... .html#more
I believe the plan is to boost the monthly "fee" from around $1.75 to something like $17.50. Dominion claimed they were losing too much money because people were conserving too much. Poor them.
http://blog.cleveland.com/business/2008 ... .html#more
I believe the plan is to boost the monthly "fee" from around $1.75 to something like $17.50. Dominion claimed they were losing too much money because people were conserving too much. Poor them.
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Will Brown
- Posts: 496
- Joined: Sat Nov 10, 2007 10:56 am
- Location: Lakewood
Commodity prices are often seasonal. I think if you look you will find that the spot market for natural gas very often goes way down in the Summer (when there is little demand), and increases in the colder months (when there is great demand). So if you are looking for a year-long contract that is based on costs during the season when demand is down, you may as well look for a bill that Kucinich has gotten congress to support; there ain't no such animal.
And if you're thinking of buying a natural gas contract on your own, understand that these contracts have expiration dates, so you can either lose all your money when the contract expires without you taking delivery, or you can lose your money renting storage space and delivery capacity for your millions of cubic feet of gas, and hoping the price soars so you can rip off someone else with some of it.
And if you're thinking of buying a natural gas contract on your own, understand that these contracts have expiration dates, so you can either lose all your money when the contract expires without you taking delivery, or you can lose your money renting storage space and delivery capacity for your millions of cubic feet of gas, and hoping the price soars so you can rip off someone else with some of it.