Customer Choice at Nicor Gas
Notes:
Another ongoing development in our gas distribution business is our unbundling efforts, which for Nicor Gas began with our largest customers in the mid eighties. Last year marked the fourth year of a pilot program called Customer Select offered to nearly 25 percent of our customers. During the last four years, Nicor Gas worked hard to implement systems and processes to handle full-scale choice for all its customers beginning this year. As we had hoped, in January of this year the Illinois Commerce Commission approved Nicor Gas’ request to permanently expand Customer Select. Now, as of March 1st, all 2 million of Nicor Gas’ customers have the opportunity to select an alternative gas supplier. And over 1xx,000 of Nicor Gas’ customers have made that choice.
As a reminder, allowing customers to choose their supplier does not directly affect Nicor Gas’ distribution margin since natural gas costs are passed directly through to customers without a markup. Alternative commodity suppliers do not change the fact our utility continues earning revenues associated with transporting the natural gas.
Programs such as Customer Select will provide customers with potential benefits that come with competitive pricing and a choice of services. As in any open marketplace, new suppliers will be able to offer alternative products and services to meet customer demands. For us, one such supplier positioned to benefit is Nicor Energy, our retail energy joint venture, which I’ll discuss shortly.