Butler Home Heating Prices Going Up

Starting today, heating a home in Butler County could cost more than it did in November. That’s because the Pennsylvania Public Utility Commission (PUC) has approved a hike in the gas cost rate (GCR) for Herman Oil and Gas Co. The new rate will be $4.5444 per one-thousand cubic feet of gas, or Mcf.

That's a 15.5 percent increase from last month's gas billing rate of $3.9356/Mcf. 

What's behind the hike? It's an 'interim' rate increase filed by Herman Oil as a response to a more than 50-percent drop in the gas cost rate that was put in place on Nov. 1.

The company filed a revised GCR effective Dec. 1, due to the correction of an estimate for an audit finding refund included in the filing effective Nov. 1.  The resulting correction increased Herman Oil’s GCR by 15.5 percent.

Gas utilities are required to provide reliable natural gas service at the lowest possible cost.  Every natural gas utility is audited annually by the PUC to ensure the GCR it is  passing on to its consumers reflects the costs the company paid and that every effort was made to purchase the natural gas for the lowest possible price.

When filing an annual GCR, a utility recalculates its rates to reflect what it projects to pay for natural gas during the upcoming 12-month GCR period, and includes a reconciliation of undercollections or overcollections resulting from differences in actual sales and actual gas costs from prior projections. The PUC has the authority to make adjustments in the annual GCR proceeding and order refunds to customers if the utility is found to have acted imprudently.

The PUC is charged with balancing the interests of consumers and utilities to ensure safe and reliable service at reasonable rates and in educating consumers in choosing utility service providers.