Status: The State has a pilot unbundling program for residential customers.
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Overview: In January 2000, the Kentucky Public Service Commission (PSC) approved a pilot customer choice program for residential and small-volume commercial customers of Columbia Gas of Kentucky. The program, "Columbia Customer Choice," began on September 2000 and is available to all Columbia customers who consume less than 25 million cubic feet of natural gas per year. Columbia continues as the supplier of last resort and remains in the merchant business, both selling and transporting natural gas to consumers. In June 2003, Columbia stated that choice participants were not saving money and asked that the pilot be discontinued 7 months before its scheduled termination date of October 31, 2004. Interstate Gas Supply (IGS), which supplies gas to most of Columbia's choice participants, disputed the claim, as did many other parties. Subsequently, the PSC determined that Columbia had used an inaccurate accounting procedure to evaluate the program. Instead, the PSC found that program participants, in the aggregate, have saved on their gas bills and ordered Columbia to extend the pilot through March 31, 2005. In April 2005 the PSC approved Columbia’s request to extend the program for another 4 years, from April 1, 2005, through March 31, 2009. As of April 2005, about 27,000 of the company’s 127,000 residential customers were participating in the pilot, down substantially from the 45,600 participating in June 2002.
On January 13, 2002, the PSC approved an agreement wherein marketers participating in Columbia’s choice program will “take assignment of minimum levels of the utility’s storage and transportation capacity and undergo a prospective capacity audit.” If a marketer does not meet its capacity requirements, the utility may assign capacity to meet the shortfall. As of December 2005, two marketers were participating in the pilot program, with both offering fixed-price terms. Larger volume customers throughout the State have had access to unbundled service since the 1980s.
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EIA State Data: In 2004, Kentucky had 766,729 residential and 84,468 commercial customers. They consumed 56 and 37 billion cubic feet of natural gas, respectively. The average prices paid for natural gas purchased from local distribution companies by residential and commercial customers were $10.97 and $10.18 per thousand cubic feet, respectively.
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Eligibility/Participation in Retail Choice Programs:
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Status as of December 31, 2005: Number of Customers
Customer
Type |
Total
2004 |
Eligible
December 2005 |
Participating
December 2005 |
Total |
Percent of
2004 Total |
Total |
Percent of
Eligible |
Percent of
2004 Total |
Residential |
766,729 |
127,072 |
16.6 |
26,674 |
21.0 |
3.5 |
Commercial |
84,468 |
14,797 |
17.5 |
3,455 |
23.3 |
4.1 |
Total |
851,197 |
141,869 |
16.7 |
30,129 |
21.2 |
3.5 |
Sources: Total 2004: Energy Information Administration, Natural Gas Annual 2004 (December 2005). Eligibility Rate: Based on customer totals for Columbia Gas of Kentucky reported on Form EIA-176, "Annual Report of Natural and Supplemental Gas Supply and Disposition," which is the primary data source for EIA's Natural Gas Annual. Participation: Columbia Gas of Kentucky.
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