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Customer Choice: Glossary of Natural Gas Terms

The Pennsylvania Public Utility Commission (PUC) provides the following definitions to make technical terms easier to understand. For simplicity, the PUC did not include the full technical details for every definition.

faq-iconActual Reading
The reading from your gas meter.
faq-iconAdjusted or Corrected Reading
An amount shown on the bill to correct too much or not enough use from a prior reading.
A group that buys natural gas to obtain lower prices for a number of consumers.
faq-iconAggregator or Market Aggregator
A natural gas supplier that plans for natural gas supply services to a group of customers in a single buying unit.
faq-iconAlternate Fuel Capability (Alternate Energy Capability)
Meeting energy needs with an energy source other than natural gas.
The amount of natural gas a Natural Gas Distribution Company (NGDC) receives for delivery to a customer or customer group and the amount of gas that customer or group actually uses.
faq-iconBasic Services
Services necessary for the physical delivery of natural gas to a retail customer, consisting of natural gas distribution services and natural gas supply services.
British Thermal Unit is the amount of heat required to raise the temperature of one pound of water by one degree Fahrenheit.
faq-iconBundled pricing
Two or more services offered at a single price.
faq-iconBurner Tip
The point at which natural gas is used, such as a furnace, water heater or range.
The amount of natural gas transported within a specific period of time. The physical limits of a gas transportation system determine capacity. On the interstate transportation system, physical capacity is often divided among several parties, each party holding a contract for a specific quantity.
Equals 100 cubic feet of gas. This is a measure of gas usage.
faq-iconChapter 56
The PUC regulations that govern metering, billing and collections for residential gas and electric service.
faq-iconCity Gate
The point where interstate pipelines deliver gas into an NGDC’s facilities.
Natural gas sold either by volume or heating value.
faq-iconCommodity Charges
The charges for basic gas supply service.
faq-iconConsumer Contract
A written statement of the terms of service between a customer and a natural gas supplier.
faq-iconCustomer Assistance Programs (CAP)
A payment program for low income people who have trouble paying their bills. This payment program is set up between a utility company and the customer. It allows the customer to pay a percent of the bill they owe or to pay a percent of their income instead of paying the actual billing each month. When an agreement is made the customer must make regular monthly payments based on their new payment plan.
faq-iconCustomer Charge
A monthly charge to cover NGDC costs to maintain the gas lines, and provide meter reading and billing.
faq-iconCustomer Choice
Customers and sellers can deal directly with each other for natural gas supplies, which are transported through NGDC’s pipes to the consumer.
faq-iconCustomer Classes
The classes of natural gas customers are residential, commercial and industrial.
faq-iconCustomer Reading
An actual meter reading made by the customer and given to the NGDC.
faq-iconDekatherm (DTH)
A measure of the heat content of gas. Gas usage is determined by multiplying the Mcf used by the heat content value of the gas.
Removal or relaxation of regulations or controls governing a business or service operation such as utility.
The delivery of natural gas from the city gate to the consumer.
faq-iconDistribution Charges
Charges for the delivery of natural gas from the point of receipt into the NGDC’s system.
The natural gas consumer.
faq-iconEstimated Reading
During months when the NGDC does not read the customer’s meter, the bill is based on previous gas usage, gas rates and weather.
faq-iconFirm Service
Natural gas service offered to consumers specified in tariffs or contracts that anticipate no interruption.
faq-iconFlat Rate
A fixed charge for goods and services that does not vary with changes in the amount used, volume consumed, or units purchased.
faq-iconFormal Complaint
A written dispute or disagreement about a utility problem filed by a consumer with the PUC. A formal complaint is assigned to an Administrative Law Judge (ALJ) who holds hearings to develop a record. After the hearings, the Judge issues a decision.
faq-iconGas Cost Adjustment Charges
The amount billed or credited each month to correct any differences between projected and actual gas supply costs of the NGDC.
faq-iconInformal Complaint
A dispute or disagreement about a utility problem filed by a consumer with the PUC’s Bureau of Consumer Services (BCS). A BCS investigator reviews the informal complaint and provides the customer with a response to their dispute.
faq-iconInterruptible Service
Natural gas services that can be interrupted under terms and conditions specified by tariff or contract.
faq-iconInterstate Transportation System
Federally regulated, large capacity pipelines that transport natural gas across state lines from points of production to NGDC’s city gates.
faq-iconLate Payment Charge
A charge for any bill not paid by the due date.
faq-iconLow Income Home Energy Assistance Program (LIHEAP)
A federal /state program to assist low income utility customer to pay for energy services.
faq-iconMarketer or Broker
An individual or business, licensed by the Commission that sells or arranges to sell natural gas. The difference between marketers and brokers is that marketers own the gas they sell, while brokers do not.
1,000 cubic feet. This is a measure of gas usage.
faq-iconMigration Rider

This rider has been eliminated due to a statutory change and will no longer appear as a line item on customer bills issued on or after December 1, 2016.


UGI is required by law to charge customers exactly what the Company paid for natural gas. Because UGI’s gas cost rates change only quarterly and actual gas costs can change daily, a mechanism is in place to ensure that customers ultimately pay the exact same price for UGI purchased gas as UGI. The Migration Rider is a true-up for gas purchased from UGI for the 12 month period prior to switching to an alternate supplier. It can be either a charge, or a credit based on actual gas costs incurred for that period compared to gas costs charged. It will apply for a 12 month period and then be eliminated. During the 12 month period, it can vary quarterly. Customers who continue to purchase gas from UGI are also subject to the exact same credit/charge to true up gas costs from the prior twelve months. The same credit/charge is consistently applied to ALL customers who purchased gas from UGI during the prior twelve months. By comparison, once a customer is served by a Choice supplier for 12 months, the customer is not subject to this true-up charge for the next 12 months even if a customer returns to UGI for gas supply service, as the customer did not contribute to the true-up currently being charged to UGI purchased gas customers. At any time in the subsequent 12 month period following a return to UGI service, a customer switches to a Choice supplier, the Migration rider will be applied for a new 12 month period.The Migration Rider ensures that costs incurred on behalf of one customer are not transferred to another customer group.

faq-iconNatural Gas Distribution Company (NGDC)
A regulated natural gas utility which owns the gas lines and equipment necessary to deliver natural gas to the consumer, formerly called LDC (Local Distribution Company).
faq-iconNatural Gas Supplier (NGS)
An entity that sells or arranges to sell natural gas to customers that are delivered through the distribution lines of an NGDC.
faq-iconNonbasic Services
Optional services which are separate and not required for the physical delivery of natural gas service.
faq-iconOffice of Consumer Advocate (OCA)
A government office that represents the interest of residential utility consumers before the Public Utility Commission. This includes rate and services cases and before other state and federal regulatory agencies and courts.
faq-iconOffice of Small Business Advocate (OSBA)
A state government office that represents the interest of small business consumers. They participate in PUC rate cases and other state and federal regulatory cases.
faq-iconOpen Market
Competition is allowed.
faq-iconPublic Input Hearings
Meetings where consumers can give input to the PUC. This is in the form of sworn or unsworn testimony, often before a PUC administrative law judge.
faq-iconPublic Meeting
Meeting, open to the public, where the PUC Commissioners vote on all rate case filings and other official PUC business.
faq-iconPublic Utility Code
The law, which sets the powers and duties of the PA PUC. It also sets many of the guidelines the PUC uses for utilities’ rates and service standards.
faq-iconPublic Utility Commission
Also known as the PUC. The state regulatory agency that provides supervision, policy, guidance and direction to public utilities and suppliers.
faq-iconService Reliability
A guarantee that the NGDC will deliver sufficient natural gas to satisfy customer consumption specified in tariffs and contracts.
faq-iconState Tax Adjustment Surcharge
A surcharge on gas rates charged to customer, which permit NGDC’s to track changes to various state taxes.
Keeping natural gas in an underground container for removal and use at a later date.
faq-iconTitle 52
The section of the Pennsylvania Code that governs utilities.
The moving of natural gas through the interstate transportation system for delivery to NGDC’s.
Breaking down services and/or rates that are offered into parts so each part is billed separately