Summit Natural Gas of Maine is dropping the price it charges for natural gas by almost 70 percent to correct for overcollection, a change that will affect part of ratepayers’ bills.

The Public Utilities Commission on Monday approved Summit’s request to drop its rate per therm from 83 cents to 26 cents, a 68 percent decrease, according to a news release from the company. In 2014, the Governor’s Energy Office estimated an average Maine household that heated with natural gas used 850 to 1,000 therms a year. Summit customers pay per therm for gas, but also pay $20.40 per month for a service charge and an 86 cents per therm delivery charge, and those last two figures won’t change.

The gas rate change was required by the commission because Summit overcollected from its customers, according to Commission Executive Director Harry Lanphear. Reducing the rates will correct that, he said.

“When Summit was approved to provide gas service to customers in Maine, part of that approval from the commission was when you are getting into a situation when you are over- or undercollecting by 10 percent, you need to file for a mid-course adjustment,” also known as a rate change, before the company’s annual negotiated rate change, Lanphear said.

“In this particular situation, Summit had overcollected from its customers,” which was driven primarily by market changes, he added. The rate will be retroactive to March 1 and will stay in place until Oct. 1.

In a statement, company spokesperson Lizzy Reinholt said mild weather this winter and a 30 percent drop in natural gas rates nationally in the last six months spurred the reduction.


“At Summit we are committed to providing reliable, safe, clean-burning fuel choice for Mainers,” Reinholt said. “We aim at working to continuously provide our customers with more predictable and affordable natural gas prices, and our current reduction in cost is another example of how we are living up to that commitment.”

Summit buys gas for its customers throughout the year, and adjustments to account for changing weather and market conditions are common, according to the company.

According to the PUC, Summit’s gas price per therm was 74.86 cents in October 2013, increased to 87.73 cents in October 2014, decreased to 45.69 cents in March 2015, rose to 82.89 cents in October 2015 and dropped to 26.3 cents this month.

Summit provides gas service to about 3,000 residential and commercial customers in parts of Kennebec and Cumberland counties. Its service area includes Gardiner, Hallowell, Augusta, Fairfield, Waterville, Madison, Farmingdale, Randolph, Falmouth, Yarmouth and Cumberland.

Maine Natural Gas, a company owned by Central Maine Power Co.’s parent company, Avangrid, won’t be asking the commission for a rate adjustment, spokesman Peter Bottomley said.

The company serves customers in Augusta, Whitefield, Windsor, Hallowell, Chelsea and the Brunswick-Freeport area.


Natural gas companies don’t make any money on gas and the cost is a pass-through to customers, Bottomley said. Where companies make their money is in service and distribution charges, he said.

Maine Natural Gas gives its customers two options for gas pricing — a fixed price set annually or an indexed cost that fluctuates monthly with changes in the market. Currently, the fixed price option is 82 cents per therm, while the index cost is 62 cents in March, down from about a dollar per therm in January, Bottomley said.

If Maine Natural Gas ended up making money on its fixed price option, it would have to calculate that overcollection into its rates for the next year, he added.

“It is a total pass-through to customers, so adjustment are made when needed,” he said.

Last year, Maine Natural Gas proposed to increase its delivery rate by 62 percent over three years to help fund its expansion into Augusta. The commission in December rejected a proposed settlement in the case negotiated by the company, the city of Augusta and the Maine Office of the Public Advocate.

Peter McGuire — 861-9239

[email protected]

Twitter: @PeteL_McGuire

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