Decoding Natural Gas Pricing Trends in Georgia

Natural gas prices fluctuate constantly, which can be confusing for gas consumers. Why are my price options so much higher than when I chose my last fixed rate? Why do I have to pay my current rate when I see other options on the website? These are questions we have all asked ourselves and finding the answers can be difficult. Luckily, we’re here to help natural gas users in Georgia understand these price changes so you can better understand what you’re paying for and what to anticipate in the future.

Factors Driving Natural Gas Prices

There are a variety of factors that influence natural gas prices, ranging from weather to trader positioning.

Weather

As you can imagine, weather has perhaps the biggest impact on natural gas prices. Warm weather tends to lead to lower prices, while prices increase with demand as temperatures cool. However, various weather predictions can change the outcome. Hot summer weather can lead to price increases due to power plants running on natural gas. Unexpectedly cold weather can lead to higher natural gas price hikes due to suppliers having a lower supply in storage. Warm winter weather predictions lead to suppliers purchasing and storing less natural gas, meaning there is more demand for the limited supply.

Storage

Speaking of storage, that also influences natural gas prices. While the natural gas industry has grown significantly in the last 5 years, natural gas storage has not. Not having enough in storage when usage spikes can lead to higher prices.

Demand

As alluded to earlier, demand is a major factor when it comes to natural gas pricing. You’ve likely heard the term “supply vs. demand” at least once in your life. A low demand for something that suppliers hold a lot of will lead to lower prices, while the opposite will hike prices up. For example, when the weather cools and many consumers are looking to use natural gas, there are more people vying for the same amount of gas. This means suppliers will use the opportunity to raise prices to have the ability to meet demand.

Generation

Natural gas production plans are often in response to pricing and demand. Recently, prices have been higher, which has driven production to increase. While it’s predicted natural gas production will continue to increase through the end of 2025, producers will be cautious. Increased gas generation could lead to an oversupply. This is great for consumers as that can drive prices down, but bad for producers as they won’t meet their projected profits.

Trader Positioning

Believe it or not, traders who buy and sell commodity contracts can also affect pricing. When traders anticipate a drop in prices, they sell contracts hoping to buy them back at a lower price. If they’re wrong, and prices start to rise, they rush to buy back their contracts to avoid loss. When this happens, it can cause prices to rise more quickly with the perceived demand.

Predictions for Future Natural Gas Prices

Natural gas pricing predictions are never guaranteed. There are several factors that will impact upcoming natural gas prices in Georgia. Production trends, storage levels, and weather patterns will continue to guide pricing as the year goes on. Due to cooler forecasts and potential tariffs on Mexico and Canada, it’s looking like prices may raise before stabilizing for the remainder of the year.

The unpredictable nature of the year to come is leading producers to be cautious by increasing supply gradually. This means that supply growth is still expected, but it will likely be growth that maintains price stability rather than lowering prices with over-supply. Consumers shouldn’t expect prices to drastically drop any time soon.

Remember, these predictions are not guaranteed. Keep an eye on the market and do your own research when it comes time to sign up for natural gas service.

Strategies for Managing Energy Costs Effectively

You can’t control the future of natural gas prices, but you can lock in a fixed rate now and use your natural gas strategically to save money.

SCANA Energy offers fixed-rate natural gas plans in certain areas of Georgia. For those eligible, a fixed-rate plan is a great choice to guarantee your natural gas therm price for an extended period of time. With a fixed rate, you don’t have to worry about the market fluctuations discussed above. Your energy bills will remain predictable for the duration of your plan.

Whether or not you are on a fixed-rate plan, you can decrease your energy usage to help save money no matter your natural gas therm price.

Here are a few tips to get you started on energy savings:

• Ensure all outdoor doors and windows are properly sealed to prevent air leaks
• Set your natural gas water heater temperature to 120°F
• Optimize your thermostat temperature settings based on the current weather
• Change your HVAC filter regularly, every 1 to 3 months depending on the manufacturer
• Reduce your hot water usage by taking shorter showers, filling up the dishwasher, and reducing laundry sessions

There are plenty of easy ways to save on your natural gas bills. Visit our blog for more tips and tricks to maximize energy savings.

Natural gas pricing can be unpredictable, but the knowledge above should help you understand all the fluctuations. We hope this helps you feel more confident while looking at natural gas rate plans and helps guide your future decisions. If you have any questions about Georgia natural gas service, our customer care representatives will be happy to answer them. Call us at 877.467.2262 to get connected with an expert today.