MORGANTOWN, W.Va. — The state Public Service Commission will consider the Purchased Gas Adjustment of about seven percent for Hope Gas.
While the PSC has no power to regulate these prices because they are a direct pass-through, the commission can examine purchasing practices of gas utilities and the current competitive market. Gas utilities must meet certain standards, but, by law, they can recover the costs of purchasing natural gas.
“Supply can’t keep up as the demand grows,” Hope Gas President and CEO Morgan O’Brien said on WAJR’s “Talk of the Town.” “So, we’re at a point in time that hopefully we’ll see more drilling and more investment in West Virginia that will help mitigate that.”
The increase, which would be passed along to Hope residential and industrial customers, is based on increased demand for energy across the board and electricity to drive AI technology. The forecast produced by the Energy Information Administration reports average consumption will increase two percent this year and another four percent next year. O’Brien said the gas satisfying this increased demand is coming from the Mountain State.
“West Virginia is a gas-rich state, but it’s a commodity,” O’Brien said. “We buy all of our gas either through interstate or directly from producers, and it’s all produced in West Virginia, so it’s all going to West Virginia producers.”
O’Brien said the increase has been carefully considered as families continue to deal with the rising cost of living.
“We’re trying to be as purposeful and as responsible as we can,” O’Brien said. “We do start and end with everything we do that can impact what a customer pays, and we don’t take that lightly, and we feel their pain.”
Long-term forecasts don’t show the demand for natural gas cooling off anytime soon. Electricity demand and AI applications will account for about 22 percent of future demand growth, while exports of liquefied natural gas are expected to increase as well.
“But it is a commodity where supply and demand impact it,” O’Brien said. “The country wants more gas, needs more gas, and unfortunately that raises the price.”
O’Brien said the Purchased Natural Gas Adjustment increase for West Virginia residents has been much lower than other states in the region. The expected increase in drilling will continue to make future increases tied to the market lower for West Virginia.
“Even though the bills are going up here in West Virginia, they’re actually going up greater in the states around us,” O’Brien said. “New Jersey, New York, and Pennsylvania are seeing greater increases than West Virginia is.”