Gas Deregulation

Natural Gas Deregulation New York

New Yorkers have had the opportunity to shop for their natural gas provider since the late 1990s. The New York Public Service Commission (PSC) started by ‘unbundling’ your energy bill, separating charges for delivering energy to your home or business from charges for the gas supply itself.

It’s in the gas supply, or commodity, charges that you can choose an alternate provider. Alternate gas suppliers, know as Energy Service Companies or ESCOs in New York, compete for you business in most utility areas, including Consolidated Edison, National Grid (Niagara Mohawk), New York State Electric & Gas (NYSEG), Rochester Gas & Electric, Central Hudson, Orange and Rockland, National Fuel Gas, Corning Natural Gas, Keyspan Energy Delivery New York, Keyspan Energy Delivery Long Island, and St. Lawrence Gas.

In New York, each utility continues to offer what is called ‘default service,’ or service to customers who have never shopped for an energy provider. This default service serves as a benchmark for pricing in the market, and typically changes every month, meaning customers do not have price stability. Choosing an alternate gas supplier, or ESCO, can give customers a locked-in gas supply rate.

Each utility has a different default service rate, based on its supply portfolio. Depending on your service area, your default service charges may be lumped into a single ‘commodity’ charge on your gas bill, which you can use as a benchmark for comparing prices from ESCOs. Some gas utilities break down your supply charges further, into a Gas Supply Charge (GSC) and a Merchant Function Charge (MFC). The Gas Supply Charge is the price the utility pays for the actual gas supply you consume. The Merchant Function Charge covers other costs involved with serving you on default service, such as billing and collection charges. Combined, the GSC and MFC dictate what you pay for energy supply, and are what should be used as a reference when shopping for an alternate energy provider. Typically, your utility bill may indicate a ‘total gas supply charge’ which combines the GSC and MFC so you can compare prices from competitors.

No matter who you choose to buy energy from, your local utility will continue to deliver your gas and respond to service interruptions and outages. You will still pay your utility for these services. In New York, depending on your area, you can choose to receive a single bill from your utility listing your utility delivery charges and ESCO supply charges, or a separate bill from the utility and alternate energy provider.

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