PA Utility’s Innovate Plan to Deliver Marcellus Gas to Customers

Although there’s a lot a cheap, abundant, and clean-burning natural gas being produced in Pennsylvania, there’s still a lot of customers who can’t burn it because of lack of pipelines through their neighborhoods. Natural gas prices currently are 61% less than fuel oil and 68% percent less than propane. But when it costs between $500,000 and $1 million a mile to install the pipelines to carry the gas–you need a lot of customers to sign up to make it work. Not everyone signs up at the beginning–some wait and see. So in places like the suburbs of Philadelphia where there’s a lot of people, it has still been a conundrum–a complex problem with no obvious solution. One of the utilities serving the Philly area, Peco, believes they have solved the problem. Peco has proposed a new formula to the Public Utility Commission (PUC) that will allow them to assume that 75% of their customers will sign up for gas over the next 20 years. The Peco plan will allow current customers to stretch the natgas hook-up fee across 20 years, radically changing the economics and lowering the hook-up price for customers–making it a no-brainer to make the change–now or in future years. Here’s the details of Peco’s plan…

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