Key Takeaways
- Significant Rate Jump: Duke Energy Ohio’s natural gas rate has increased roughly 44% to $0.49 per ccf for December, which will add approximately $22.50 to the supply portion of an average residential heating bill.
- Market Drivers: The price hike is primarily driven by seasonal winter demand, tighter domestic production inventories, and record U.S. LNG exports that are linking Ohio’s local prices to higher global market rates.
- Regional Comparison: Despite the increase, Duke’s rate remains significantly lower than Columbia Gas of Ohio’s rate of over $0.76 per ccf, and residents within the City of Hamilton are exempt entirely because they are served by a separate municipal utility.
As winter temperatures settle into the Miami Valley, residents in Southwest Ohio are facing a sharp increase in their heating costs. Effective today, Duke Energy Ohio has adjusted its Gas Cost Recovery (GCR) rate to approximately $0.49 per hundred cubic feet (ccf), a significant jump from the November rate of $0.34 per ccf.
While energy analysts had predicted a seasonal rise, the 44% month-over-month increase arrives just as households are turning on furnaces for the season. For the average home using 150 ccf of gas during a cold December, this rate change alone could add roughly $22.50 to the supply portion of the monthly bill, pushing total heating costs higher before distribution charges and taxes are even applied.
Why The Sudden Spike?
Duke Energy, like other Ohio utilities, passes the cost of natural gas directly to consumers without a profit markup on the commodity itself. The new $0.49 rate reflects the higher prices Duke is paying in the wholesale market to secure fuel for the winter.
Several factors are driving this surge:
- Seasonal Demand: Demand for natural gas peaks in December and January. As meteorologists forecast colder “Alberta Clipper” systems moving into the Midwest, the market is pricing in the need for more heating fuel.
- Tightening Supply: Domestic production of natural gas dipped late in the year due to pipeline maintenance, including work on the Rockies Express Pipeline that feeds into Ohio.
- Global Exports: The U.S. is exporting record amounts of Liquefied Natural Gas (LNG) to Europe and Asia. This links Ohio’s local prices to the global market; when international demand rises, it pulls domestic supply toward the coasts, raising prices here at home.
How It Compares to Neighbors
Despite the sticker shock, Duke Energy customers are faring significantly better than their neighbors in Central Ohio. Columbia Gas of Ohio recently set its December Standard Choice Offer (SCO) rate at over $0.76 per ccf, more than 50% higher than Duke’s new rate.
“Duke customers are seeing volatility, but they aren’t seeing the extreme premiums we are observing in other parts of the state,” notes data from the Public Utilities Commission of Ohio (PUCO).
Impacted Cities and The “Hamilton Exception”
The rate increase affects the entirety of Duke Energy Ohio’s natural gas service territory, which covers approximately 3,000 square miles in the southwestern corner of the state.
Major communities impacted include:
- Hamilton County: Cincinnati, Norwood, Blue Ash, and Anderson Township.
- Butler County: West Chester, Monroe, Trenton, and Oxford.
- Warren County: Mason and Loveland.
- Clermont County: Batavia and Milford.
However, not everyone in the region will see this hike. Residents within the City of Hamilton are served by the city’s own municipal gas utility, the largest of its kind in Ohio. These residents are shielded from Duke’s specific GCR rate adjustment. Conversely, residents in the townships immediately surrounding Hamilton (such as Fairfield Township and Hanover Township) are typically Duke customers and will see the new $0.49 rate on their bills.
What You Can Do
Ohio is an energy choice state, meaning consumers do not have to buy their gas from Duke Energy. The new rate of $0.49 per ccf is now the “Price to Compare.”
- Check Your Rate: Look at your bill. If you are already with a competitive supplier, check your contract rate. If it is higher than $0.49, you may be overpaying.
- Shop Around: Visit the PUCO’s Energy Choice Ohio website to compare fixed-rate offers. While many low introductory rates have disappeared, you may still find stability in a fixed-rate plan.
- Budget Billing: To avoid a massive bill in January, consider enrolling in Duke’s budget billing program, which spreads out the winter spike over a 12-month average.
For more updates on utility rates and tips for lowering your energy bill, stay tuned to utilitiesformyhome.com.
Sources: Public Utilities Commission of Ohio (PUCO), Duke Energy Tariff Filings, U.S. Energy Information Administration (EIA).
About the Author
David has been an integral part of some of the biggest utility sites on the internet, including InMyArea.com, HighSpeedInternet.com, BroadbandNow.com, and U.S. News. He brings over 15 years of experience writing about, compiling and analyzing utility data.