When we untangle the cost of fuel & the cost of keeping things running we can help you conserve natural gas & save money!
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Revenue Decoupling is a regulatory tool that separates utility company revenue from ups & downs in energy sales.
CenterPoint Energy’s Revenue Decoupling program will break the link between utility revenues & sold energy, removing the motivation for the company to encourage increased natural gas use.
CenterPoint Energy began Revenue Decoupling in July 2015 & the adjustment appeared on bills in September of 2016.
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Revenue decoupling is a way to break the link between the amount of natural gas sold & the recovery of costs associated with delivering natural gas.
With decoupling, CenterPoint Energy can help its customers conserve energy, while also maintaining the revenue required to provide safe and reliable natural gas services.
Costs to deliver gas and maintain a safe and reliable system don’t change very much, regardless of how much natural gas is used by customers – so they are called ‘fixed’ costs. Previously, lower gas usage meant less revenue for CenterPoint Energy to cover those fixed costs. Revenue Decoupling makes it possible for customers to use less energy, but also ensure that CenterPoint Energy maintains the ability to cover the fixed costs.
Under decoupling, your gas bill is based on the amount of natural gas that you use. So, if you use less gas, you ultimately will pay less.
In September of 2016, you started seeing the revenue decoupling adjustment on your monthly bill.
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CenterPoint Energy has been decoupled since July 2015. However, the first decoupling adjustment factor began for customer billing in September of 2016. The decoupling adjustment factor will change once per year in September.
The decoupling adjustment is used to make sure that CenterPoint Energy recovers no more and no less than the revenue that was approved in the last rate case; so that if customer usage goes up (or down), the company still collects the revenue needed to maintain a safe and reliable distribution system.
A decoupling adjustment allows CenterPoint Energy to increase its rates if the company recovers less than its approved revenue in a given year or decrease rates if the utility recovers more than the approved revenue.
The majority of your bill is still based on the amount of natural gas you use, so you will still save money by conserving gas.
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Decoupling is designed to eliminate the utility company’s motivation to make more money by encouraging increased natural gas usage.
By removing the incentive to sell more, utility companies can promote energy conservation without worrying about having enough revenue to cover fixed delivery costs.
Regulators of public utilities, such as the MPUC (Minnesota Public Utilities Commission), along with CenterPoint Energy, are working hard to resolve the tension between energy conservation efforts & the revenue required to cover fixed operational costs.
Through Decoupling, CenterPoint Energy can continue to deliver natural gas safely & reliably to help customers conserve and use less energy.
Don’t worry... The majority of your bill is based on current wholesale gas prices & how much natural gas you use. Unless natural gas prices or the amount of gas you use changes significantly, you should not see a significant change in your bill with decoupling.
Also, while there is no cap on the amount customers will be refunded under a revenue surplus, there is a cap on the surcharge if there is a revenue shortage. That cap is set at 10% of the utility's non-gas commodity costs, which is about 3-4% of your total bill.
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