Several factors determine the amount of your gas bill every month. Here you can learn about the main sections of your gas bill. As you review this information, it may be helpful to have your bill with you.
Natural gas costs make up the largest portion of your Nicor Gas bill. This is the charge for the gas you use during the billing month. It is calculated by multiplying your gas usage by the average cost per therm we pay for gas supplies. The amount you pay varies monthly based on the cost of gas and the amount you use. Nicor Gas does not profit from gas costs; we pass our cost on to you without markup.
Delivery charges shown on your bill consist of the following:
Monthly Customer Charge – a fixed amount that covers our expenses to read your meter, produce your bill and other monthly administrative costs. A small portion of this charge covers various taxes. This charge is incurred even if no gas is used.
Distribution Charges – covers our operating and distribution costs. These charges vary monthly based on the amount of natural gas you use.
Environmental Recovery Cost – covers our cost for the environmental monitoring and clean-up of former manufactured gas facilities. This cost changes periodically, and Nicor Gas does not profit from these charges.
Franchise Cost – covers our cost for municipal franchise agreements. Nicor Gas does not profit from this charge.
Governmental Agency Adjustment – an adjustment for governmental fees and added costs, excluding franchise costs. This cost changes periodically, and Nicor Gas does not profit from these adjustments.
Efficiency Program Charge (Effective June, 2009) – pays for costs related to energy efficiency programs. Nicor Gas does not profit from this charge.
Taxes are levied by the State of Illinois and various local municipalities.There are several taxes that may be associated with your natural gas bill, including:
State Revenue Tax – a tax mandated by the state
Utility Fund Tax – mandated by the state, this tax funds the Illinois Commerce Commission (ICC), which regulates all Illinois utilities
State Use Tax – a tax for gas purchased outside Illinois for use in Illinois
Municipal Utility Tax – some municipalities charge this tax which is based on utility revenues and applied according to the municipality's local ordinance
Municipal Use Tax – some municipalities charge this tax based on your gas usage
More information about charges related to our Customer Select alternative gas supplier program, third-party warranty and other services> For more information please see the back of your bill.
Heating degree days were developed as a way to relate each day's temperature to the demand for fuel to heat buildings.
Heating degree days are calculated by adding the high and low temperatures of a given day and then dividing by two (to obtain the average temperature). Each degree the average daily temperature falls below 65 degrees represents a heating degree day.
Take a look at the following example:
High temperature: 38
Low temperature: 24
Add the day's high and low temperatures: 38 + 24 = 62
Divide by two: 62 / 2 = 31
The average temperature for the day is 31 degrees.
Subtract the average temperature from 65: 65 - 31 = 34
There are 34 degree days for this day.
Since your individual gas use and your bill can be affected by weather, your Nicor Gas bill shows "total degree days" for both the current billing period and the same period last year so you can compare them.
The National Weather Service has detailed degree day information for various regions of the country, including the Chicago area.