Ameren Missouri files for lower natural gas rate

Ameren Missouri files for lower natural gas rate

ST. LOUIS (KFVS) - Ameren Missouri residential customers would pay the lowest Purchased Gas Adjustment (PGA) rates in 15 years under a proposed rate decrease filed today with the Missouri Public Service Commission.

The proposal calls for a PGA rate of $0.50 per 100 cubic-feet (Ccf) of natural gas, down by 7% from the current rate of $0.54/Ccf and 24% from the $0.66/Ccf rate approved in October 2014.

If approved, the new rate would take effect Nov. 1.

Compared to the rates enacted in October 2014, the proposed PGA would save an average residential customer in certain Ameren Missouri service areas - including Cape Girardeau, Columbia, Jefferson City, Marble Hill, Mexico, Moberly and Wentzville - approximately $98 per year.

PGA rates have been dropping for the last year due to wholesale natural gas prices going down, caused by growing supplies generated by shale production.

Ameren Missouri customers would continue to benefit from the trend under the company's PGA rate proposal.

"Lower natural gas wholesale prices make it possible for us to propose rate reductions," said Jim Massmann, Ameren Missouri's gas supply director.

"Our proposed PGA rate is the lowest it's been since 2000."

The PGA reflects the wholesale cost of natural gas, the cost of transporting gas to the company's system plus an adjustment to compensate for under- or over-collection of actual costs in previous periods.

Wholesale gas prices aren't regulated, and price changes are the result of supply and demand. This causes wholesale costs to change daily, while the PGA rate is held stable over a period of months.

Throughout the year, Ameren Missouri monitors the PGA under- and over-collection balance, to assess the need to adjust gas rates.

Ameren Missouri is allowed to make up to four changes to the PGA per year. No more than one change may be made during any two consecutive months.

Ameren Missouri says customers can reduce their natural gas usage by installing more efficient natural gas equipment.

More information can be found here.

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