Frequently Asked Questions
Tap & Save™ Program Overview
On October 23, 2014, the Pennsylvania Public Utility Commission (PUC) approved Columbia Gas of Pennsylvania’s pilot program to provide a new option for residential customers who are not currently receiving natural gas service but who want natural gas service. As a result of this approval, many potential customers will have an option to pay for their line extension over a period of 20 years rather than the upfront payment that Columbia Gas has historically been required to charge.
Instead of paying the entire payment up front, qualifying residential customers may be able to pay all or a portion of the mainline and/or service line payment through a monthly charge of “up to” or “not more than” $35 per month for new natural gas service under the program. Columbia Gas is piloting this new option over the next four years, investing up to $1 million per calendar year to increase affordable access to safe, efficient, and clean-burning natural gas.
1. How does the Tap & Save™ program work?
Prior to extending facilities to serve new customers, Columbia Gas will design service to the residential customer and then perform an economic analysis to determine whether the proposed project is economically justified. This is the same way we do business today.
When this analysis is complete, if the maximum allowable investment or the full cost of the extension cannot be justified by projected revenues, there is a required payment (the “excess amount”). This is the same way we do business today.
If there is a required payment for main and/or service, the Tap & Save™ program allows all or a portion of the excess amount to be recovered through an additional monthly charge up to $35 payable over a period of 20 years rather than through a upfront payment.
This would significantly reduce the upfront cost of obtaining natural gas service from Columbia Gas where the Company does not currently have facilities available.
2. Why convert to natural gas?
Natural gas prices are the lowest and most stable in nearly a decade. Based on recent pricing, Pennsylvania residents using another energy source to heat their homes could save up to 40 percent or more per year when they convert to natural gas heat. Now is a great time for homeowners using another energy source to convert to natural gas.
3. How long will Columbia Gas offer this program?
Columbia Gas is proposing to implement the program as a four-year pilot. However, any project established under the Tap & Save™ pilot will continue until the required investment is satisfied, even if the program is retired or amended after the pilot period.
This program is offered under a first-come, first-served basis until the program dollars are exhausted.
4. How can I find out if I qualify to take advantage of the Tap & Save™ program?
The Tap & Save™ program is available to qualifying residential customers, and bona fide builders and developers can use the Tap & Save™ option for residential homes they are building.
Please contact Columbia Gas of Pennsylvania’s New Business Development department at 1-800-440-6111, Monday through Friday, 8:00 AM to 4:30 PM.
5. How is the Tap & Save™ program cost determined?
Columbia Gas will use the uneconomic portion of the cost of the main and/or service line as the starting point to determine the monthly Tap & Save™ charge.
The charge will then be determined using a simple-interest formula with a 20-year payment term.
The maximum charge is $35 per month for residential customers.
Therefore, if the uneconomic portion of the cost of the service line or main line extension plus interest set at Columbia Gas of Pennsylvania’s most recent weighted cost of capital (currently 7.91%) can be paid for over a 20-year period for no more than $35 per month, the new customer will not be required to make an upfront payment.
There will be an upfront payment if the cost of the uneconomic portion of the line extension, plus interest, cannot be paid for over a 20-year period for $35 per month or less.
Once the monthly charge is set, the customer’s monthly charge will not change.
6. What if a customer moves after being part of the Tap & Save™ program?
If the customer moves, the charge stays with the meter at the premises, and a new customer moving in would resume the charges.
7. How long does the charge appear on the customer’s bill?
The customer may pay off the remaining balance at any time, after their first bill is sent. The customer must contact Columbia Gas at 1-888-460-4332 prior to making payoff.
The Tap & Save™ charge is on the customer’s bill for 20 years or until the required investment is satisfied.
8. Can multiple customers in an area to be served by a line extension share the cost through the Tap & Save™ program?
Yes. All qualifying residential customers on that same line extension will pay the same monthly rate.
New residential customers (who were not considered with the original project) will pay the same rate and their payments will pay down the balance of the original main and/or service faster.
If the original residence is vacant for a period of time, no payments are collected. When someone does move in, they will pick up the future payments but not the prior unpaid monthly payment balance.
9. Is this program only available to residential service?
Yes, the Tap & Save™ program is available to qualifying residential customers, and bona fide builders and developers can use the Tap & Save™ program for residential homes they are building.
10. How much money is Columbia Gas allocating to the Tap & Save™ program?
Columbia Gas will put a maximum of $1 million per calendar year into the Tap & Save™ program for the next four years – a total of $4 million. This amount will be available to qualifying customers on a first-come, first-served basis.
11. Why did Columbia Gas seek this new method to extend natural gas lines?
Columbia Gas proposed this change in an effort to make natural gas service more accessible to Pennsylvanians not currently served by natural gas energy. In many cases, the economic analysis shows that a large upfront payment is needed for Columbia Gas to extend its main lines, which can deter customers from taking natural gas service.
This is particularly true when the customer is located a significant distance from the Company’s existing facilities. If it is an existing home where the owner is seeking natural gas service, the payment required from Columbia Gas in addition to the cost of replacing equipment can deter a homeowner from converting to natural gas service.
Similarly, when developers plan a new development, the payment requirement could cause them to decide against installing natural gas service to the homes or buildings. Given the abundance of low-cost natural gas that is being produced in Pennsylvania as a result of Marcellus Shale supplies, Columbia Gas is committed to pursuing ideas making it easier for Pennsylvanians to obtain natural gas service.