Leary estimated the average home uses about 20 dekatherms of natural gas a month during January. A dekatherm is equal to 1,000 cubic feet of gas.
The cost of one unit for borough customers was 80 cents last winter, according to Leary. He estimated that will rise to an average of 85 cents this winter, but predictions of milder temperatures could mean bills will average out about the same.
Borough customers should continue to pay about 20 percent to 30 percent less than Columbia and PPL customers, Leary said. Those on the borough system paid about 25 percent less for a unit in 2002 than state average, Leary said, citing U.S. Department of Energy data.
Unlike most Pennsylvania municipalities, Chambersburg owns all its major utilities, including gas and electric. It buys gas on the market and then sells it to customers on its distribution system.
The gas and electric industries, however, both were deregulated in recent years, meaning natural gas now is traded like other commodities such as gold or pork bellies, Leary told the council.
The borough and its customers have an advantage because the system is not geared toward making a profit and "is not meant to make gobs of money for our shareholders," Leary said.
"One of the benefits of being a municipal gas system is it can float tax-free municipal bonds and buy gas ahead of time" at lower prices, he said. The borough is negotiating an extension of its gas supply and capacity management contract with the Municipal Gas Authority of Georgia and may enter into a pre-paid agreement with the authority that Leary said could save the borough $72,000 annually over the next five years.
For this year, the budget for the purchase of gas was about $4.7 million, but the borough spent nearly $7 million because of higher prices and increased demand, according to Leary. The system generated income of approximately $8.5 million from sales to customers, however.
Total expenses, though, were about $51,000 more than total income. Leary said that was due to the borough having to spend about $260,000 more than budgeted to buy and store gas over the summer. That deficit, he said, will be recouped when the gas is sold to customers this winter.
Next year, Leary projects the borough will spend about $5.8 million on gas purchases and realize income of about $7.8 million.
