Natural Gas Supply Options
Looking for Natural Gas supply rates for your company? New England’s Natural Gas markets are arguably more complicated and volatile than its electric markets. Utilizing a similar review process, Pursuit Energy Solutions works with Natural Gas users to determine which product will work best for them. Given the large differences between the available Natural Gas products, we work with customers to educate them about their choices and the risks associated with each contract. Natural Gas is typically sold as a daily balanced, monthly balanced, or Full-Swing product.
Daily Balanced – This is one of the more sophisticated Natural Gas products offered in the Market. Customers can purchase a fixed amount of Natural Gas per day in advance. Daily consumption is then compared to actual consumption and the customer either buys or sells in the spot market to cover the difference. This product works well for customers with consistent daily consumption throughout the year and best for customers that have dual fuel capabilities.
Monthly Balanced – Similar to a daily balanced product, customers purchase a monthly quantity of Natural Gas. At the end of each month, the balance is trued up based on a monthly settlement price. This is more expensive than a Daily Balanced product but offers more protection for the consumer.
Full Swing/Monthly Balanced 25% Swing – This is the most secure method of purchasing Natural Gas. Consumers are either given no bandwidth restrictions, or a Monthly quantity with a +/- 25% swing tolerance. This means that consumers can use 25% more or less than their monthly contracted quantity and remain within their swing tolerance. This is for customers that require budget certainty and do not want to take any risk.
Dual Fuel Switching – This is the most sophisticated Natural Gas purchasing option available in the market and requires that customers have an alternative to Natural Gas, typicall No. 2 or No. 6 Oil. This method allows consumers to purchase Natural Gas and No. 2 or No. 6 in advance. Customers then make determinations on which fuel source to burn depending on the pricing of both. Significant volatility on certain days present arbitrage opportunities and allow customers to sell Natural Gas on extremely cold days when it is in short supply and at a higher price than their heating Oil Equivalent per dth.