The reduction, effective Saturday, amounts to more than $3 a month to a typical residential heating customer.
The price of natural gas will drop about 4 percent for Lehigh Valley residents this winter, UGI Utilities Inc. said today.
UGI said today that an average residential customer’s bill will drop more than $3 a month effective Saturday, from $89.55 to $86.17, or 3.8 percent.
A separate division that serves the Slate Belt and part of Lehigh County — UGI Central Penn Gas — is reducing rates 2.5 percent. That results in a decrease from $93.41 to $91.03 for a typical customer.
Current prices are in effect until the end of February. Prices can be adjusted quarterly based on wholesale trends.
“We are especially pleased to see this reduction in purchase gas cost at a time when our economy is beginning to expand and demand for energy is increasing,” Vicki Ebner, a senior vice president at UGI, said in a statement.
Wholesale prices have generally declined because of increased supply relating to discoveries of natural gas found in Marcellus Shale, or rock formations found in large parts of Pennsylvania and neighboring states.
But natural gas prices have begun to rally recently, now trading at about $3.70 per million British thermal units after falling below $2 in April, and are up 23.7 percent for the year.
UGI spokesman Joseph Swope says current rates reflect past purchases, so the recent rally is not reflected in the current bill. UGI first submitted its winter price forecast to state regulators in June.
Pennsylvania utilities by law are not permitted to profit on changes to wholesale rates. Increases or decreases are passed along to customers without markup. Utilities profit on the distribution of natural gas.