Those using natural gas from the city of Leitchfield to heat their homes could see their bills drop in coming months.
During its meeting Thursday, Nov. 15, the city’s Utilities Commission approved lowering the costs of natural gas for both residential and industrial customers.
For bills issued after Dec. 1, the rate for residential customers will fall 20 cents, to $8.45 per 1,000 cubic feet used.
Leitchfield charges residential customers a minimum billing of 1,000 cubic feet, then bills by 1,000 cubic feet for additional usage.
For industrial customers — those using over 20 million cubic feet per year — the rate will fall 15 cents, to $7.95 per 1,000 cubic feet used.
The previous rates had been adopted in November 2010.
For a customer using 10,000 cubic feet of natural gas in a month — the average monthly residential use in the state, according to the Kentucky Public Service Commission — the new rate would mean a savings of $2. Individual bills and savings will vary.
Robert Crawford, the utilities commission chairman, said the city has about 60 percent of its anticipated gas needs hedged through March, and has been able to get that fuel at lower rates.
Earlier this month the Public Service Commission said natural gas costs were expected to be lower this winter than at any time in the last 10 years.
Wholesale costs this year are, on average, about 20 percent lower than a year ago, and wholesale prices over the last three years have remained at less than half the peak prices seen in 2008. Wholesale costs make up the largest portion of retail gas bills during the heating season. They are passed through to consumers on a dollar-for-dollar basis by local distribution companies.
Crawford said the city’s ability to hedge so much of its anticipated fuel needs at lower rates meant that customers could be offered “a little relief” while still maintaining the financial stability of the utility.
Utilities superintendent Kevin Pharis said Leitchfield has about 3,000 gas customers — with lines stretching into neighboring counties.
According to the U.S. Department of Energy, about 44 percent of Kentucky households use natural gas for heating and to power hot water heaters, compared to about 51 percent of homes nationwide.
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