Natural Gas Deregulation

June 24, 2010

Large market swings offer you big savings.

If you have been following market prices for natural gas, over the past couple of years, you have probably noticed the large market swings. 

In 2008, PSEG prices ranged from $1.07 per therm in February to $1.64 per therm in July.

In 2009, prices dropped and we saw $.889 cents per therm in January with a low of $.496 cents a therm in September. 

This is good news for those interested in saving money in the deregulated natural gas market. PSEG and SJ Gas buy natural gas on the open market wholesale and sell it to their clients retail.

Should you be spending a minimum of $5,000 a month on natural gas for yor business, there is a big opportnity for savings.

With so much market fluctuation, we have been advising our clients to float their accounts, based on the market index.  If you are a PSEG client and chose to float the index over the past 12 months, you would have saved 12%-15% on your supply bill. SJ gas customers would have saved 8%, while NJ Natural gas clients would have saved 13%

Choosing to float the market index does not preclude you “locking in” on a fixed price at any time during the term of the contract. Conversely, if you choose a fixed price, you are unable to change to a float when market prices go down.

Note: Since the prices of natural gas have been so low, we have also seen this play a large effect on the reduction of electric prices in the deregulated market. Did you know that 30% of the electric generated is made from natural gas?

Want to learn more about opportunities to save in the deregulated natural gas market or deregulated electric market email george@hbsadvantage.com or call 856-857-1230.

Visit us on the web www.hutchinsonbusinesssolutions.com

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