Are You Paying Too Much For Your Home’s Natural Gas? 

If you’ve been shocked by your natural gas bill lately, you’re not alone. But here’s the surprising part: while wholesale natural gas prices hit historic lows in 2024, many homeowners are still paying more than they should. The reason? Most people don’t realize they have a choice in who supplies their natural gas.

This article will help you understand what you’re really paying for, how Pennsylvania’s deregulated energy market works, and how shopping for a natural gas supplier can save you money while providing benefits like fixed pricing and cash-back rewards.

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What Makes Up Your Natural Gas Bill?

Your natural gas bill consists of two main parts: supply charges and delivery charges. Understanding this split is the first step to knowing where you can save money.

Supply charges are what you pay for the actual natural gas itself—the commodity. This is the portion you have control over and can shop for in Pennsylvania’s deregulated market.

Delivery or distribution charges cover the infrastructure costs: maintaining pipelines, responding to emergencies, reading meters, and delivering gas safely to your home. These charges are set by your utility company and remain the same regardless of which supplier you choose.

Here’s what many homeowners don’t realize: the composition of natural gas bills has shifted dramatically over the past few decades. According to NPR’s analysis of Energy Information Administration data, in 1984, two-thirds of your bill paid for the actual gas. Today, less than one-third goes to the gas itself, while two-thirds covers infrastructure and delivery costs. This means that even when wholesale gas prices drop, your overall bill may not decrease proportionally—but it also means the supply portion offers real savings opportunities when you shop around.

While delivery charges have increased due to pipeline infrastructure upgrades and safety improvements, the supply portion of your bill is where you have control and choice. Shopping for a competitive natural gas supplier can help you lock in better rates and take advantage of market conditions.

What Are Homeowners Paying Now?

According to the U.S. Energy Information Administration’s Winter Fuels Outlook for 2024-2025, the average American household is projected to spend approximately $602 on natural gas during this winter heating season. That represents only a modest 1% increase from last year, despite expectations of colder weather in some regions.

The good news? Natural gas prices are at their lowest levels in decades. According to the Energy Information Administration, the Henry Hub spot price averaged $2.21/MMBtu in 2024—the lowest annual average ever recorded when adjusted for inflation. This represents a 16% decrease from 2023 and a remarkable 68% drop from 2022.

So why aren’t homeowners seeing these savings reflected in their bills? Two reasons: First, infrastructure costs make up an increasingly large portion of total bills, as we discussed earlier. Second, many homeowners are stuck on variable-rate plans with their default utility supplier, missing the opportunity to lock in competitive fixed rates during this period of historically low prices.

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How Does Energy Deregulation Work in Pennsylvania?

Energy Deregulation: The Pennsylvania Natural Gas Choice and Competition Act of 1999 separated natural gas supply from delivery, allowing homeowners to choose their natural gas supplier while the utility company continues to maintain infrastructure and deliver gas to homes.

Pennsylvania’s deregulation gave homeowners the freedom to shop for natural gas suppliers the same way they shop for cell phone plans or internet service. Here’s how it works in practice:

1. You choose a supplier from over 60 licensed natural gas suppliers in Pennsylvania, including companies like Shipley Energy, based on pricing, contract terms, and benefits offered.
2. Your utility continues delivery – Nothing changes about how gas reaches your home. Your utility company (Columbia Gas, PECO, UGI, etc.) still maintains the pipes, responds to emergencies, and handles infrastructure.
3. You receive one bill that combines your chosen supplier’s rate for the gas itself with your utility’s delivery charges. Everything appears on a single, easy-to-read statement.
4. No service interruption – Switching suppliers is entirely administrative. You’ll never experience any interruption in your gas service.

Over 500,000 Pennsylvania residents have already taken advantage of natural gas choice programs. Of the approximately 2.8 million natural gas customers in Pennsylvania, roughly 415,000 actively participate in supplier choice programs, and that number continues to grow.

Switching suppliers doesn’t change anything about how gas is delivered to your home—your utility company still maintains the pipes, responds to emergencies, and sends your bill. What changes is the rate you pay for the supply portion and the benefits you receive from your chosen supplier.

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What are the Benefits of Shopping for Natural Gas Suppliers?

When you shop for a natural gas supplier in Pennsylvania’s deregulated market, you gain access to several advantages that can significantly impact your household budget:

1. Fixed-Price Plans for Budget Certainty:
   Variable rates can fluctuate dramatically with market conditions. Fixed-price plans eliminate the uncertainty of seasonal price spikes, giving you predictable monthly costs for the life of your contract. This is especially valuable for homeowners on fixed incomes or tight budgets who need to plan their expenses months in advance.
2. Protection from Market Volatility:
   When wholesale prices spike due to weather events, geopolitical factors, or supply disruptions, variable-rate customers feel the impact immediately. Fixed-rate customers are protected throughout their contract term, regardless of what happens in the broader market.
3. Rewards Programs and Added Value:
   Beyond competitive pricing, alternative suppliers often provide value-added benefits that traditional utilities don’t offer. For example, Shipley Energy customers earn 3% back in rewards for gift cards to their favorite stores—essentially reducing their effective energy costs even further.
4. No Sign-Up Fees or Hidden Costs:
   Reputable suppliers like Shipley Energy don’t charge sign-up fees, connection fees, or other hidden costs. Switching is completely free, and you can start saving from day one.
5. Transparent, Competitive Pricing:
   In a deregulated market, suppliers compete for your business by offering transparent pricing and clear contract terms. This competition drives rates down and service quality up, benefiting consumers who take the time to compare options.

Shipley Energy is a natural gas supplier that delivers all of these benefits with competitive fixed-rate plans, no hidden fees, and a 3% rewards program that puts money back in your pocket.

Take Control of Your Natural Gas Costs

Many homeowners overpay for natural gas simply because they don’t realize they have options. Pennsylvania’s deregulated market gives you the power to choose a supplier that offers better rates, fixed pricing for budget certainty, and valuable benefits like rewards programs.

Now is an excellent time to shop for a competitive rate and lock in savings. The process takes just minutes, requires no service interruption, and could save you hundreds of dollars over the course of a year.

Ready to see if you’re paying too much? Contact Shipley Energy to get a competitive quote and start saving on your monthly bills, or shop online now.

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