Customer Communication Gas Prices 2003 - PowerPoint PPT Presentation

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Customer Communication Gas Prices 2003

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Gas Prices 2003. An Overview. of Strategies and Tactics. MLGW ... NYMEX Historic Futures Prices. Putting the Issue in Perspective. Residential gas bills ... – PowerPoint PPT presentation

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Title: Customer Communication Gas Prices 2003


1
Customer CommunicationGas Prices 2003
  • An Overview
  • of Strategies and Tactics

2
MLGW
  • Founded in 1939
  • The nations largest three-service municipal
    utility
  • Serving more than 450,000 customers
  • Nearly 315,000 gas customers

3
Developing the Strategy
  • Early customer communication of new gas
    strategies
  • News article
  • Energy Saver Guide
  • Customer bill insert
  • Educate employees and board members
  • Forecast card sent to employees
  • Information advisory to customer service
  • Employee newsletter
  • Briefing of Board, VPs, and Managers

4
Customer Education
  • Encouraging customers to control costs through
    conservation
  • Providing brochures, web site information and
    online energy audits, and other advertising
    promoting energy conservation

5
Key Messages
  • Five major factors affecting gas bills
  • Weather
  • Consumption
  • Price
  • Storage
  • Economy
  • Ways customers can control costs
  • MLGW has many assistance programs to help those
    in need.

6
Assistance Programs
  • Plus-1
  • Round-Up
  • MaxImpact
  • SmartPay
  • Winter Moratorium

7
MLGW Efforts to Control Costs
  • MLGW utilizes hedging as a means of keeping
    rates stable during volatile market conditions.
    MLGW hedges by
  • Fix cost with NYMEX futures contracts
  • Purchasing gas from many suppliers
  • Utilities underground storage
  • Varying contract lengths and terms with suppliers

8
MLGW Efforts to Control Costs
  • Price caps are used to provide a maximum price
    for gas regardless of market price
  • Locked up a larger portion of gas than in
    previous winters
  • Storage will be full for peak use months

9
MLGW Futures hedges vs. NYMEX Close
10
NYMEX Historic Futures Prices
11
Putting the Issue in Perspective
  • Residential gas bills
  • are the third lowest in the nation.
  • New Orleans 119.75
  • El Paso 132.81
  • MLGW 157.27
  • Detroit 159.56
  • St. Louis 187.51
  • Houston 218.04
  • Little Rock 251.47

12
Putting the Issue in Perspective
Highlights of PGA Fluctuations
  • Winter
  • Feb. 00 0.0266
  • Feb. 01 1.0864
  • Feb. 02 0.1303
  • Feb. 03 0.4013
  • Fall
  • Sept. 00 0.0911
  • Sept. 01 -0.0479
  • Aug. 02 0.0237

13
Customer CommunicationGas Prices 2003
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