What You Need to Know about Natural Gas

Natural gas is often over looked when you’re dealing with your home utilities. In some cases, most of your household appliances need natural gas to operate. Understanding the basics of natural gas will ultimately save you a substantial amount of money over time.

Here are some quick tips about natural gas that you should know especially if you are a homeowner:

Regulated vs. Deregulated

Like electricity, some states are deregulated when it comes to natural gas. This is prefect if you are a consumer who is looking to shop around for the best possible deal.

This is the basic rationale for why the natural gas market has been deregulated in many states as regulatory reform was developed to change the way consumers pay for natural gas.

Natural gas consumers today in deregulated markets have the option to shop around and purchase their natural gas from the retail marketer who offers the lowest prices and best customer service. There are 21 states, plus Washington, D.C., that offer deregulated gas markets.

When marketers in deregulated natural gas states offer consistent low and stable prices, promotions or discounts for new customers and some type of rewards programs for existing customers as an incentive to retain their services, then natural gas marketers have found themselves profitable and able to attract and retain their customers.

If you happen to live in a regulated state, you have no choice but to purchase your natural gas from the main utility company that provides those services. There is no other option.

Comparing Market Prices

The best way to determine whether you’re getting the best value for your natural gas is to make sure you are comparing the natural gas terms equally. Understand the marketer’s pricing options before you choose a specific plan. A fixed rate will remain the same monthly rate over the term of your contract, often 12 months. A variable rate may change each month, depending on the natural gas market, and this may allow you to wait until rates are low and lock into a fixed rate plan at that time. Fixed rate plans may include an early termination fee if you were to cancel the contract before it expires, so it’s important to understand what you’re agreeing to when you sign with a natural gas marketer. Some may offer discounts or other special offers. Some offer discounts for senior citizens.

Understanding Contract Terms

It’s important to fully understand what you’re signing up for when you agree to a contract with a natural gas marketer. Some require deposits, based on your credit history or utility payment history. They may allow you to pay it in installments. Find out about any disconnect or reconnect fees, which can vary. If you are unhappy with the natural gas marketer and want to shop for a better deal, will you have to pay a termination fee or any other switching fees? If so, what is their switch request policy? Find out all the information you need to cover every question you may have about the terms of the contract. This will save you from a having a huge headache in the long run.