FREQUENTLY ASKED QUESTIONS - GAS
INDEX:
Customer Charge
Distribution or Delivery Rate
Cost of Gas or Gas Supply Rate
Weather Normalization Adjustment
Reading Your Gas Meter
What is the customer charge?
The customer charge is a flat charge applied
each month regardless of the amount of natural gas used.
The charge is designed to recover the cost of such items
as customer accounting, mailing, billing and metering.
What is the distribution or delivery rate?
The distribution or delivery rate is based on utility operating expenses, including depreciation and
income taxes, plus a return on the utility's assets used in providing utility service and is intended to
compensate the utility for the cost of delivering natural gas through their pipeline system to end-use
customers.
What is the cost of gas or gas supply rate?
The cost of gas or gas supply rate is the per unit rate for natural gas sold to customers. There is no mark-up or profit
added to the cost of gas. The utilities only recover from customers the actual cost of the natural gas commodity and the cost of
transporting that gas from gas producing regions over interstate pipelines to the natural gas utilities. The costs recovered
through the cost of gas supply mechanism are subject to Commission review and approval to ensure that the utilities purchase the
gas in a prudent manner consistent with the requirements of Arkansas law. The rate changes two times a year, April and November,
respectively.
Do natural gas utilities profit from the sale of natural gas?
No. Natural gas utilities do not make a profit on the natural gas that is sold to customers. Natural gas
utilities simply recover the cost of the natural gas they purchase through the purchased gas adjustment
mechanism. Only the actual costs paid to suppliers are recovered from customers. The costs recovered are subject
to Commission review and approval.
What is the purpose of the weather normalization adjustment?
The purpose of the weather normalization adjustment (WNA) is to adjust customers’ bills to "normal
weather." If during a billing cycle the weather is colder than normal, the customer will receive a credit on
the bill. Conversely, warmer than normal weather will cause a charge to appear on customers’ bills. The WNA
amount shown on a customer’s bill will vary based on the actual weather experienced during the billing cycle on
which the bill is based.
How to read your Gas meter

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Revised: June 16, 2008.
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