Consumer Education Table of Contents

Understanding Your Natural Gas Bill

Your natural gas bill has three main components – the delivery service charge, gas supply charge and taxes. Residential and small business customers in some areas of Illinois have the choice to purchase their gas supply from their utility or an Alternative Gas Supplier (AGS).

Regardless of your choice of supplier, your local gas utility will continue to deliver the natural gas to your house or business. The delivery of natural gas to your house or business will not be interrupted when you switch gas suppliers.

Natural gas utilities offering AGS choice programs have additional information regarding the charges on your gas bill at the following links.

Nicor Gas - Understanding Your Bill - Customer Select ProgramExternal Link
North Shore Gas – Rates and ChargesExternal Link
Peoples Gas – Rates and ChargesExternal Link

The Delivery Charge

This is the price you pay to your local gas utility for the cost of transporting or delivering natural gas from the City Gate to your home or business regardless of whether the gas is purchased from the utility or an AGS. You cannot choose who provides your natural gas delivery service. This charge is to compensate your local utility for the cost of maintaining the lines and transporting natural gas to your home or business. It includes charges for things like meter reading, billing, equipment and maintenance and is regulated by the Illinois Commerce Commission (ICC). The local utility continues to provide this service regardless of whether the gas is purchased from the utility or an AGS.

The Gas Supply Charge

In certain parts of Illinois, customers can choose who they want to purchase their natural gas from. The gas supply charge is the price you pay for the natural gas commodity consumed in your home or business in a given month. For a residential customer using natural gas to heat a home, the supply charge will account for approximately 75 percent of your bill on an annual basis.

If you purchase your gas supply through the local utility, the utility uses a regulatory mechanism called the Purchased Gas Adjustment (PGA) to compute your monthly gas supply cost. Under the PGA mechanism, the price you pay per therm of gas consumed can change monthly. The PGA includes, among other items, the anticipated cost of gas for the month as well as adjustments from prior periods to true-up under and over recoveries. The gas utilities' PGA filings undergo an annual prudency review by the ICC and gas utilities are not permitted to mark up the cost before passing that price along to its customers. Nicor Gas customers will see the gas supply charge on their bill as the Natural Gas Cost. North Shore Gas and Peoples Gas customers will see the gas supply charge on their bill as the Gas Charge.

If you choose to purchase your gas from an AGS, the gas supply will be charged at the rate you agree upon with the supplier in your contract. The rates charged by an AGS are not regulated or subject to review by the ICC.

State and Local Taxes

State and Local Taxes are also included on customer bills. The taxes that apply may differ depending on whether you purchase gas from the utility or from and AGS.

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What is Natural Gas Choice?

In Illinois, residential and small business customers of Nicor Gas, North Shore Gas, and Peoples Gas utilities currently have the option to purchase their natural gas supply from an Alternative Gas Supplier (AGS). Whether you decide to purchase your natural gas supply from your local gas utility or switch to another company for your gas supply, your local natural gas utility will continue to deliver the gas to your home or business. The natural gas itself, meets the same requirements and pipeline standards whether purchased from the utility or an AGS. If you are considering switching natural gas suppliers, please take a moment to review information on this website to help you better understand your choices. The ICC is committed to ensuring you have the necessary information to make an informed decision about choosing your natural gas supplier.

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Consumers May Continue to Purchase Natural Gas from their Utility or Enroll with a Supplier

Where choice programs are available, customers may choose to continue to receive their natural gas supply from their local gas utility or switch to an AGS. If you wish to continue receiving your gas supply from the utility, you don’t have to do anything. If you want to consider purchasing your natural gas from an alternative supplier, the ICC website contains a list of certified AGS and their current offers. You may also receive direct solicitation from an AGS regarding services available. Customers are encouraged to review the information on this website before agreeing to switch. If you decide to switch to an AGS after considering the various offers available, you must contact that AGS to enroll. It doesn’t matter to the utility whether you purchase your gas supply from them or an AGS, because utilities are required to pass their gas supply cost on to customers at the price they pay with no markup.

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No Matter Your Choice, the Utility Is Responsible for Safe and Reliable Delivery and Service

Whether you stay with your local gas utility or switch to another company for your gas supply, your local utility is responsible for responding to your natural gas safety concerns and providing reliable natural gas delivery service. If you smell gas or have a gas emergency, you should always call your local gas utility.

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ICC Regulation of Alternative Gas Suppliers

While the ICC does not regulate the prices offered by AGS, the ICC does regulate supplier sales and marketing practices to residential and small commercial customers and assists with customer disputes. Alternative Gas Suppliers offering service to residential and small commercial customers (with consumption of less than 5,000 terms annually) must be certified by the ICC. These suppliers must follow strict procedures when enrolling a customer to ensure the customer understands the terms of their agreement and that a record of the customer’s authorization is kept.

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Consumer Protection

All Alternative Gas Suppliers must be certified by the ICC to provide service to residential and small commercial customers.

A new law (Public Act 95-1051) which took effect April 10, 2009 established consumer rights and protections that include:

Consumer Rights

  • Consumers have the right to rescind their agreement without penalty within 10 business days after the date on the gas utility notice to the customer.
  • A consumer may not be charged an early termination penalty that exceeds $50 and all early termination penalties must be disclosed to consumers.
  • A consumer may terminate an agreement with an AGS without incurring an early termination penalty within 10 business days of the date the first bill is issued. This does not relieve the customer of the obligation to pay for services already received under a contract which was entered into lawfully.
  • Consumers who prefer not to receive information or solicitations from suppliers may request to be added to their gas utility's "Do Not Contact List". AGS and their sales agents are prohibited from any direct marketing or soliciting consumers on the list. Consumers may use the following phone numbers to register with their gas utility's "Do Not Contact List":
    • Nicor Gas        1-888-642-6748
    • North Shore Gas     1-866-556-6004
    • People’s Gas       1-866-556-6001

Obligations of AGS

  • An AGS must obtain customer authorization before switching a customer to another supplier. At a minimum, the authorization must include the identity of the customer, confirmation that the person is authorized to make the change, confirmation that the person wants to make the switch, address where service is to be provided, the price of the service and the material terms and conditions of the service including any early termination fee.
  • Before switching a customer, an AGS must clearly and conspicuously disclose in writing the prices, terms and conditions of products and services.
  • An AGS must disclose a customer’s right to rescind an agreement. The AGS must disclose that the gas utility will send a notice confirming the switch, that the customer has 10 business days from that date to rescind the switch, that the customer can contact the utility or the AGS to rescind the switch, and the contact information for the utility.
  • An AGS is required to disclose the amount of any termination penalty or fee that applies. If an early termination fee applies, the AGS must allow the customer to cancel the contract without any termination fee or penalty within 10 days after the date the first bill is issued. This does not relieve the customer of the obligation to pay for services already received under a contract which was entered into lawfully.
  • An AGS must comply with Illinois law regarding solicitation and sales verification requirements applicable to in-person solicitation (including door-to-door solicitation), telemarketing, consumer initiated calls, and internet enrollment.
  • Additional solicitation and sales verification requirements apply to in-person and telephone solicitations.
    • An AGS soliciting customers in-person, including door-to-door solicitation, must clearly and conspicuously disclose the salesperson's name and company's address, phone number and website; contact information for the ICC.
    • An AGS soliciting customers by telephone must disclose the name of the person making the solicitation, the name of the AGS, the purpose of the call and ask permission to continue the call.
  • An AGS is prohibited from misrepresenting its affiliation with the gas utility, governmental bodies and consumer groups. An AGS is required to establish a call center and provide a toll-free number for customers to resolve complaints.
  • An AGS may not obligate a customer to the terms of the agreement if that customer moves outside Illinois, to a location without a transportation service program or to a location where the customer will not require natural gas service. This does not relieve the costomer of their obligation to pay for services already provided.
  • An AGS may not assign the customer’s agreement to another AGS unless that AGS is certified by the ICC, the rates and terms of the agreement do not change during the remainder of the time covered by the agreement, and the customer is given no less than 30 days prior written notice of the assignment including contact information for the AGS assigning the contract and the new AGS.
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Current and Historical Utility Gas Supply Charges

The majority of your gas bill reflects the cost of the natural gas commodity you consume. The price that gas utilities in Illinois pay for natural gas is referred to as the Purchased Gas Adjustment (PGA). It includes the price utilities anticipate to pay to purchase gas in the wholesale market, including the costs of transportation and storage services, and any reconciliation from prior months. These charges can vary from month to month. Gas utilities do not profit from the price of gas; it must be passed on to consumers without markup. The PGA may also be noted on your gas bill as the Natural Gas Cost or the Gas Charge.

To help customers better understand how the cost of natural gas fluctuates, the ICC has posted current and historical gas supply charges for each gas utility. Below are charts showing the utilities' gas supply charges for the current and previous two calendar years as well as charts showing the historical gas supply charges for each utility for the past 10 years.

Nicor Gas Historical Natural Gas Cost Rates per therm

  Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2012 $0.4400 $0.3300 $0.3400 $0.2800 $0.2200 $0.3100 $0.3400 $0.3900 $0.3900 $0.3900 $0.4100 $0.4500
2013 $0.4200 $0.4000 $0.4200 $0.4800 $0.5300 $0.5000 $0.4100 $0.3800 $0.3600 $0.3900 $0.4100 $0.4000
2014 $0.4600 $0.5100 $0.6800 $0.6800 $0.6800 $0.6800 $0.6800 $0.6800

North Shore Gas Historical Gas Charge Rates per therm

  Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2012 $0.4765 $0.4128 $0.3745 $0.3400 $0.3233 $0.3395 $0.3630 $0.3988 $0.4212 $0.4358 $0.4777 $0.4453
2013 $0.4557 $0.4536 $0.4310 $0.4717 $0.5138 $0.5387 $0.5757 $0.5882 $0.4865 $0.4890 $0.4901 $0.4790
2014 $0.5200 $0.5675 $0.8816 $1.2151 $0.9199 $0.8468 $0.8307 $0.7817

People's Gas Historical Gas Charge Rates per therm

  Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2012 $0.4190 $0.3631 $0.3333 $0.3072 $0.2914 $0.3098 $0.3177 $0.3471 $0.3779 $0.3794 $0.4121 $0.3765
2013 $0.4110 $0.4097 $0.3922 $0.4286 $0.4692 $0.5130 $0.5490 $0.5552 $0.5509 $0.4735 $0.4499 $0.4437
2014 $0.4773 $0.5183 $0.9336 $1.1915 $0.8458 $0.8103 $0.8627 $0.7511

View the 2005-2014 Gas Supply Rates by Utility

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Important Information to Consider When Shopping

For a residential customer using natural gas to heat a home, approximately 75 percent of your average annual natural gas bill is comprised of the gas supply charge which is based on two factors – the amount of natural gas you use and the price you pay for natural gas.

It is important to know how much gas you use each month. Natural Gas usage is measured in therms on your bill. You can get this information from your local gas utility; it is also included on each billing statement from the utility.

Gas usage varies sharply in different seasons. The average residential customer in Illinois will consume nearly 75 percent of their total natural gas supply from November through March. Therefore, the supply charge for natural gas will have a much greater effect on your bill in the winter months than the summer months. The information and bar graph below shows how gas consumption for the average residential customer varies each month and the impact the consumption would have on a bill if the supply price remained constant. Natural gas consumption and the corresponding gas supply charges can be nearly ten times higher in winter months than in summer months.

Month Therms Consumed Price per Therm Gas Supply Charge
Jan 215 $.50 $107.50
Feb 171 $.50 $85.50
March 135 $.50 $67.50
April 73 $.50 $36.50
May 36 $.50 $18.00
June 26 $.50 $13.00
July 24 $.50 $12.00
August 23 $.50 $11.50
September 26 $.50 $13.00
October 58 $.50 $29.00
November 108 $.50 $54.00
December 193 $.50 $96.50

Average Gas Usage Chart

It is important to know what your local gas utility charges for the supply of natural gas. This price is indicated as the utility's Natural Gas Cost or Gas Charge and changes monthly. It is the projected cost the utility pays for the natural gas plus any reconciliation from prior periods and is passed on to the customer with no mark up. Historical gas supply rates for your utility can be found here.

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How to Compare Prices

The ICC provides price comparison worksheets to help you compare supply options from your local utility and AGS. It is important to understand the different types of offers available from suppliers and to decide if you prefer a fixed price or variable price. Some offers have lower introductory prices or prices that guarantee savings over the utility price for a certain period of time. As always, it's important to ask questions and make sure you understand the price, terms and conditions before agreeing to a contract.

What is a variable price plan?

On a variable price plan, the price per therm can change monthly, weekly or daily depending on market conditions or other factors. Consumers should look to specific offers for the terms of variability. It may include a termination fee up to $50 if a consumer breaks the contract before the plan's term expires.

What is a fixed price plan?

A fixed price plan allows you to contract with a gas supplier for natural gas to be billed at the same amount per therm for a specified period of time. Some fixed price contracts include a termination fee up to $50 if a consumer breaks the contract before the plan's term expires.

What is a fixed bill plan?

On a fixed bill plan, a customer will pay the same amount every month for a set period of time. Changes in your use or the market price of natural gas should not affect the amount you pay. The amount billed is based on the customer's past usage history. A fixed bill plan may include delivery charges and taxes. It may include a termination fee up to $50 if a consumer breaks the contract before the plan’s term expires.

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Availability of "Do Not Contact List"

Customers who prefer not to receive information or solicitations from suppliers may request to be added to their gas utility's "Do Not Contact List". Alternative Gas Suppliers and their sales agents are prohibited from any direct marketing to consumers on the list or soliciting consumers on the list. Consumers may use the following phone numbers to register with their gas utility's "Do Not Contact List":

  • Nicor Gas        1-888-642-6748
  • North Shore Gas     1-866-556-6004
  • People's Gas       1-866-556-6001
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Procedures to Address Complaints

Each AGS is required to have a complaint resolution process in place. A toll free number for the AGS' customer call center can be found on your bill. If you are not satisfied with the outcome after contacting the AGS, you may request assistance from the ICC, Illinois Attorney General, or the Citizens Utility Board (CUB).

Illinois Commerce Commission 1-800-524-0795 http://www.icc.illinois.gov/consumer/complaint/
Attorney General 1-800-386-5438 http://www.illinoisattorneygeneral.gov/consumers/index.htmlExternal Link
Citizens Utility Board 1-800-669-5556 http://www.citizensutilityboard.org/CUBfaq.htmlExternal Link
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Alternative Gas Suppliers' Complaint Summary

The Illinois Commerce Commission maintains a summary of consumer complaints it receives from residential and small commercial customers regarding Alternative Gas Suppliers. The summary provides the total number of informal complaints and formal complaints reported to the ICC quarterly. Complaints are organized in three categories: marketing and sales; contracts and billing; and customer service. All Alternative Gas Suppliers with certificates to serve residential and small commercial customers in Illinois are included in the summary, regardless of whether they are currently marketing to consumers or serving customers. The summary provides the total number of complaints received for each Alternative Gas Supplier and does not account for the number of customers served.

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List of Alternative Gas Suppliers That Have Failed to Provide Service in Accordance with the Law

Pursuant to Section 19-125 of the Public Utilities Act, the Illinois Commerce Commission lists all certified alternative gas suppliers serving residential and small commercial customers that have been found in the last 3 years by the Commission to have failed to provide service in accordance with the Public Utilities Act:

  • None at this time.
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