Proposed Regulatory Changes To Promote Competition For Retail Natural Gas Market

As part of its ongoing efforts to create a more level playing field in the retail natural gas market, the Public Utility Commission this week began the process of making regulatory changes to promote competition for natural gas suppliers.

 

The Commission voted 5-0 to issue a proposed rulemaking for comment that is designed to make it easier for consumers to compare natural gas prices offered by natural gas distribution companies and natural gas suppliers. The goal of the rulemaking is to foster a competitive retail marketplace for natural gas service.

 

Both Commission Chairman James H. Cawley and Vice Chairman Tyrone J. Christy issued statements on the proposed changes.

 

The proposed rulemaking will:

 

-- Reformulate the "price to compare" used by consumers to judge whether the price offered by a competitive NGS is better than the one being offered by the incumbent NGDC;

 

-- Make permanent rules for establishing voluntary purchase of receivables programs;

 

-- Provide guidance to ensure that the release, assignment or transfer of capacity by an NGDC is nondiscriminatory and is at the applicable contract rate; and

 

-- Change the handling of the recoverable costs related to competition activities and regulatory assessments. These costs are not to be considered in the calculation of the price to compare.

 

This action is part of the Commission's ongoing implementation of an action plan designed to increase effective competition in the retail market for natural gas supply. The action plan was approved on September 11, 2008. This followed a Commission finding that "effective competition" did not exist in the retail natural gas supply market statewide.

 

The PUC then convened natural gas industry stakeholders to examine avenues to increase competition. The name SEARCH (Stakeholders Exploring Avenues for Removing Competition Hurdles) was adopted for these group meetings.

 

Comments are due 45 days after the publication of the Order in the Pennsylvania Bulletin.

 

For more information, visit the Natural Gas Competition webpage.