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Changes in the Natural Gas industry in the District of Columbia

 

In 1995, Washington Gas Light Company (“WGL”) filed the first of several proposals with the Public Service Commission of the District of Columbia (“Commission”) requesting permission to change the way it conducts business in the District of Columbia. WGL’s goal was to allow natural gas customers of all classes the opportunity to choose whether they want to obtain gas from a supplier other than Washington Gas. WGL’s tariffs proposed to “unbundle,” or separate out, the costs of different components of its service so customers can see exactly what they pay for each component (e.g., the cost of gas, pipeline costs, delivery costs, etc.)

The Commission ultimately approved tariffs which authorized WGL to unbundle charges for non-residential customers, authorized large commercial customers to purchase gas from third party suppliers and receive delivery service from WGL, and authorized a program for residential gas customers to purchase gas from third party suppliers and receive delivery service from WGL. The effect of WGL’s unbundling tariffs was to change WGL from a monopoly utility providing totally bundled natural gas service to one offering selected unbundled services in a more competitive market. The impact on WGL’s natural gas consumers is they now have the ability to select a company other than Washington Gas to provide them with natural gas. Additionally, WGL continues to deliver gas to all consumers, regardless of who sells the commodity.