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Determination of Rate Classifications

Our rate classifications are based on the way customer groups use natural gas and the impact of their use on the operation and maintenance of our system. Factors that are considered include annual load (how much natural gas is used during the year) and load factor (how uniform the use is throughout the year). If your use remains fairly constant throughout the year, you have a high load factor. If your use rises and falls throughout the year, your load factor is low.

Your Rate Options

Rate 4 – General Service
Rate 4 is appropriate for commercial and industrial customers with annual use up to 800,000 therms. Rate 4 sales service customers purchase all natural gas supplies from Nicor Gas.

Rate 4 with Customer Select®
Certain Rate 4 customers may find the Customer Select program to be advantageous. Through Customer Select, customers can select from a number of natural gas suppliers offering this service. Program participants continue to pay the Nicor Gas delivery charges because Nicor Gas continues to deliver their gas to them, but do not pay the Nicor Gas gas supply cost because their gas supplies are provided by a third party.

However, a portion of the Nicor Gas gas supply cost is used to provide this service. Therefore, Customer Select customers pay a Customer Select Charge (see Glossary of Terms - NEEDSLINK) to recover this cost. Additionally, Customer Select customers receive a Transportation Service Credit (therms X $0.0211) for costs normally incurred by Nicor Gas sales service customers that are not incurred by Customer Select customers. Both items are per therm charges or credits applied to the monthly use of the customer.

Rate 4 with Rider 25* – Firm Transportation Service
The customer profile is the same as Rate 4 – General Service. However, these customers arrange for gas purchases from another source and contract with Nicor Gas for storage and 100 percent backup service. The customer also pays the Nicor Gas delivery charge, a portion of the gas supply charge (for providing the 100 percent backup service) and administrative charges.

* Rider 25 is a fully bundled service under which customers can transport their own supplies. A fixed storage capacity is assigned to each customer equivalent to 28 times their Maximum Daily Contract Quantity (MDCQ) through May 31, 2009 and 31 times their MDCQ beginning June 1, 2009. Each customer is fully backed up and any supplies required in excess of customer-owned gas will be provided by Nicor Gas at the Commodity Gas Cost. Customers that have more than one account in our service territory may form groups. Grouping allows consolidation of administrative activities such as nominating gas.

Rate 74 – General Transportation Service
The customer profile is the same as Rate 4 – General Service. However, these customers arrange for gas purchases from another source and contract with Nicor Gas for varying amounts of storage and firm backup options. Rate 74 is considered an "unbundled" rate because you can select your storage and backup levels.

Rate 5 – Seasonal Use Service
Rate 5 is available to customers that use less than five percent of their annual gas consumption during the billing months ending January 1 through April 30. Examples of this type of customer would include a farm with grain dryers or an asphalt plant. These customers have the same storage and backup service options as those shown for Rate 4. Their usage is limited to 700,000 therms annually.

Rate 5 with Customer Select®
The customer profile is the same as Rate 5 – Seasonal Use Service. However, certain Rate 5 customers may find the options offered by Customer Select to be advantageous. See "Rate 4 with Customer Select" for program details.

Rate 5 with Rider 25
The customer profile is the same as Rate 5 – Seasonal Use Service. However,these customers arrange for gas purchases from another source and contract with Nicor Gas for storage and 100 percent backup service. Charges are similar to those explained in Rate 4 with Rider 25.

Rate 75 – Seasonal Use Transportation Service
Rate 75 provides unbundled transportation service similar to Rate 74, but is intended for seasonal use customers (see Rate 5) that use less than five percent of their annual gas consumption from December through March and purchase their gas from another source.

Rate 6 – Large General Service
Rate 6 is economical for large commercial and industrial customers with annual loads greater than 800,000 therms and high load factors. This rate has a minimum bill of $3,500 excluding gas commodity costs. Customers purchase all natural gas supplies from Nicor Gas.

Rate 6 with Rider 25
The customer profile is the same as Rate 6 - Large General Service. However, these customers arrange for gas purchases from another source and contract with Nicor Gas for storage and 100 percent backup service. Additional charges are similar to those explained in Rate 4 with Rider 25.

Rate 76 – Large General Transportation Service
Rate 76 provides unbundled transportation service similar to Rate 74, but for Rate 6 profile customers. This rate has a minimum bill of $2,600 excluding gas commodity costs.

Rate 7 – Large Volume Service
Our largest customers with a monthly use greater than 800,000 therms may find this rate the most economical. Rate 7 has a minimum monthly bill of $8,900 excluding gas commodity costs and is dependent on load factor because it has a demand charge based on the highest daily use in the month and a distribution charge for each metered therm. We can provide a detailed analysis that will determine whether Rate 6 or Rate 7 is more appropriate.

Rate 7 with Rider 25
The customer profile is the same as Rate 7 – Large Volume Service. However, these customers arrange for purchases from another source and contract with Nicor Gas for storage and 100 percent backup service. Additional charges are similar to those explained in Rate 4 with Rider 25.

Rate 77 – Large Volume Transportation Service
Rate 77 provides unbundled transportation service similar to Rate 74, but is intended for Rate 7 profile customers. This rate has a minimum bill of $9,200 excluding gas commodity costs.