Natural Gas Overview
Natural gas is the energy source most Ohioans use to heat their homes. Several separate and distinct industries produce, transport, and distribute gas throughout
Natural gas is an abundant fossil fuel that is found in deposits around the world. About 90 percent of the gas used in
Although gas production is not regulated by the PUCO, local gas companies, on behalf of their customers, have purchased this commodity and arranged for its transport to their distribution facilities since the 1930s.
Transmission companies transport natural gas from wells through interstate pipelines. There are more than 285,000 miles of pipeline that link major production areas to consumers throughout the
Whether withdrawn from storage or sent straight from the well or processing plant, natural gas eventually arrives at the city gate – the physical location where gas is delivered by a pipeline to a local distribution company. The gas passes through a metering system that measures the quantity delivered to the local gas company, then enters a pressure control station that reduces the gas pressure to a level appropriate for the lines used by the local distribution company. For safety reasons, the distribution company also adds the familiar odor that identifies natural gas, since natural gas is odorless.
Regulating Natural Gas Today
Traditionally, users of natural gas have paid a local distribution company to purchase the commodity from producers, ensure it was transported through interstate pipelines to the local gas company, and then deliver it directly to homes and businesses. However, beginning in the 1970s, industrial customers were given the opportunity to purchase the commodity directly from suppliers.
In 1997, this choice was extended to certain residential and small commercial customers throughout the state in programs like the Columbia Gas of Ohio Customer Choice program, the Dominion Gas Energy Choice program, the Duke Customer Choice program and the Vectren Energy Delivery of Ohio Choice Advantage program. Today, customers in these areas can choose their commodity supply from the offerings of gas marketers, while the local distribution company continues to guarantee delivery.
Gas Pipeline Safety
The PUCO administers a gas pipeline safety program for natural gas delivery in
Natural gas marketers offer a commodity choice to residential and small commercial natural gas customers in
The Cost of Natural Gas Service
The cost of natural gas on a typical bill comprises about 80 percent of the total. The cost of transportation and delivery makes up the rest. The PUCO reviews the gas purchasing activities of local distribution companies since they purchase supplies on behalf of their customers. Each distribution company must submit a regular filing to the PUCO. The information contained in the filing explains the expected cost of gas for the upcoming quarter. The PUCO reviews the information to ensure that the distribution company does not make a profit on the purchase of natural gas. Companies are only allowed to profit from the transportation and distribution of the natural gas.