Choosing an Energy Partner
Misinformation, misconceptions and misunderstandings: Natural gas choice programs de-myth-tified.
We bust the myths and set the record straight.
Myth: Consumers and businesses only have one choice when it comes to natural gas suppliers – their local utility.
Fact: Most natural gas customers have a lot of choices when selecting a natural gas supplier. The federal government deregulated the natural gas industry in the mid-1990s so that customers could choose their natural gas supplier instead of being forced to buy only from their local natural gas utility. Since then, providers like IGS Energy have entered the market with many choices for competitively priced products. Today, it’s likely you have your choice of several to more than a dozen suppliers. You can check with your state’s utility regulator for a list of certified companies.
New York: www.dps.state.ny.us
Myth: Deregulation has resulted in higher natural gas costs for consumers and businesses.
Fact: Deregulation has helped to bring prices down. While natural gas prices are, and always will be, subject to the principles of supply and demand, more providers means more competition – and competition leads to increased efficiency and lower prices.
Myth: Deregulation has caused instability in the marketplace and the disruption of natural gas service to consumers and businesses.
Fact: Before deregulation, natural gas was distributed inefficiently across the country and prices fluctuated wildly. Today, IGS Energy and other natural gas suppliers give consumers the ability to lock in rates at low prices with several options of competitively priced products. When you sign a contract with IGS Energy, we buy your natural gas at wholesale prices from the open market or directly from well owners. Natural gas is then scheduled by IGS to be transported via major interstate pipelines to your utility. From there, it is delivered to your business the same way it’s delivered by your local utility, so there is never a disruption in service.
Setting Natural Gas Prices
Myth: Natural gas prices always go up when the weather turns cold.
Fact: The price of natural gas is sensitive to several factors, but supply and demand most often determines rates in the marketplace. For example, if a large deposit of natural gas is discovered, supply may increase and the price will drop. If a winter season is not as cold as predicted and there is less demand for natural gas, the price may drop. The U.S. Department of Energy indicates that residential prices have, in fact, declined in the winter months during nearly every year of the last decade: http://www.eia.gov/dnav/ng/hist/n3010us3m.htm.
Myth: Utilities provide consumers and businesses with the best price for natural gas.
Fact: Utilities often increase their rates reactively when natural gas demand is high or infrastructure improvements are needed. You’ve probably read or seen news stories about how utilities ask state regulators for permission to raise prices. IGS Energy, on the other hand, can lock in your natural gas rates for a predetermined period and provide consumers with the fairest price in the marketplace.
Myth: Utilities and natural gas marketers determine what they charge consumers and businesses for natural gas.
Fact: Just like other commodities, the price of natural gas is determined by the market. Natural gas is bought and sold on the New York Mercantile Exchange, or NYMEX. To buy gas, a natural gas supplier like IGS Energy purchases a futures contract: an agreement between a buyer and a seller for gas to be delivered at a future date. The price of the futures contract is determined by forecasted supply and demand.
IGS Energy employs natural gas buyers and traders who have unparalleled industry knowledge, expertise, and experience. They work daily to find the best prices for our customers because opportunities in the natural gas market come and go with very little notice.
Myth: Consumers and businesses pay more for natural gas when they choose their natural gas supplier.
Fact: Consumers and businesses often, but not always, pay less for natural gas when they choose their natural gas supplier because they have the option to lock in fixed rates, protecting themselves from price increases. Like other commodity prices, natural gas prices can be volatile, low one month and extremely high the next. Consumers and businesses often choose to work with a natural gas supplier to eliminate that volatility.
Myth: Choosing IGS Energy to provide natural gas sacrifices service reliability.
Fact: There will never be a sacrifice in reliability. Your natural gas will always be delivered to your home or place of business by your local utility, just as it always has been. IGS Energy examines the market for the lowest-priced gas it can find and then delivers that to your utility, which in turn delivers it to you.
Myth: Because IGS Energy does not operate the distribution system to homes or businesses, local utilities can cut off service at any time.
Fact: Federal and state laws require your local utility to deliver gas to your business, regardless of your chosen natural gas provider. Even so, IGS Energy works directly with your utility to make sure your business never experiences a lapse in service.
Myth: Because natural gas suppliers purchase and store natural gas for future use, there is a chance that supplies will run out, and service will be disrupted to homes or businesses.
Fact: IGS Energy is the leading independent retail supplier of natural gas in the U.S., and has a 20-plus-year track record of providing uninterrupted gas service to its more than 800,000 customers.
Myth: IGS Energy provides consumers and businesses with only one choice for natural gas service.
Fact: Unlike a natural gas utility, IGS Energy can offer consumers and businesses an array of variable and fixed-rate products, customized to meet residential and business customer needs.
Myth: Once a service contract is signed, IGS Energy does not allow consumers or businesses to change plans until the length of the contract runs out.
Fact: IGS Energy works with you to find the best solution for your business, and that may include switching to another IGS Energy rate plan that better serves the customers need. If you have a question about the terms of your contract, please contact an IGS Energy customer service representative.