New York State Electric & Gas Corp (NYSEG) and related parties have agreed to a settlement that would freeze natural gas prices for nearly three years, from December 1, 1995, until July 31, 1998. NYSEG would eliminate the gas adjustment and weather normalization clauses, and establish a service-quality incentive, setting earnings, rewards, or penalties based on performance. The performance indicators for years two and three would be modified in conjunction with customer-service negotiations scheduled to begin in February 1996.
The monthly minimum charge for residential nonheat customers would increase from $6.40 to $10 per month; the charge for residential heat customers would increase from $6.40 to $14 per month. Usage rates would be lowered, however, to prevent any overall increase for the residential class as a whole. The minimum charge for nonresidential firm sales customers would increase from $6.40 to $18, also offset by reductions in usage charges. Nonresidential sales customers would have two pricing options: 1) a fixed price for a set term based on the New York Mercantile Exchange futures strip, or 2) an index price adjusted monthly to changes in published commodity indices.
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