A green option for Peco gas customers

Posted: January 25, 2014

Residential customers who heat their homes with natural gas may be feeling rather comfy these cold winter days. But for those who feel a tinge of guilt about their carbon footprint, there's a way to ease their conscience.

Washington Gas Energy Services Inc. (WGES), a retail energy supplier from Herndon, Va., on Thursday announced a new product for Peco gas customers that will offset the greenhouse emissions they produce by reducing carbon emissions in Pennsylvania.

WGES will subsidize methane gas capture projects at landfills in Conestoga, Lebanon, and Scotland, Pa., which it says are verifiable environmental benefits. It is also creating a Pennsylvania Carbon Reduction Fund, managed by the Pennsylvania Environmental Council, to fund additional clean air and water projects such as tree plantings throughout the state.

Harry Warren, president of WGES, said the Pennsylvania program was modeled on a product WGES pioneered four years ago in the Washington, Maryland, and Virginia markets. In that program, it collaborated with Chesapeake Bay Foundation to mitigate the environmental impact of gas consumption.

"Certain groups of people who are really environmentally conscious seek those products out," he said.

A clean conscience does not come cheap, however.

The WGES offer to reduce 100 percent of the carbon a customer emits is priced at 73 cents per hundred cubic feet of gas (ccf), fixed for 12 months. That's 34 percent more than Peco's current price of 54.49 cents per ccf.

At that rate, the average retail customer, who uses 900 ccf a year, would pay an additional $167 a year for carbon offsets.

WGES also offers a less pricey product, for which it will buy offsets for 5 percent of the carbon emitted by residential customers. But it's still 10 percent above Peco's rate.

The company also charges a $150 early-termination fee, which is likely to deter some customers from switching.

Yet, despite its costs, the WGES offering adds a new wrinkle to Pennsylvania's retail natural gas markets, which have been slow to gain much traction with customers.

Unlike electricity markets, where nearly 40 percent of customers have switched to competitive suppliers, only 13 percent of Pennsylvania's 2.9 million gas customers have switched from their traditional utilities, according to the Pennsylvania Public Utility Commission website where current offers are posted: pagasswitch.com.

While competitive electricity suppliers offer big discounts to the utilities' rates, few competitive gas suppliers can beat the utility.

The WGES PA Carbon Offsets program is the first time a residential gas supplier has devised an offer that includes a premium service to justify the premium price.

"It's not only adding something that differentiates the basic commodity sale of natural gas to a customer," Warren said. "It also has a very local impact that means something to customers."

In its first three years offering the carbon offsets in the Washington area, WGES turned over more than $400,000 to carbon-reduction programs in the Chesapeake Bay region.

More information can be found at www.wges.com.

The Pennsylvania Office of Consumer Advocate will also mail a residential gas-shopping guide free. Call 1-800-684-6560.


215-854-2947 @Maykuth

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