"Bob F" wrote in message
...

"DerbyDad03" wrote in message
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On Nov 20, 10:55 am, Phisherman wrote:
On Tue, 18 Nov 2008 23:39:35 -0500, frank1492
wrote:

I live in Massachusetts and my natural gas is
supplied by Nstar. I have been given the option to lock in
my gas price for this heating season at $1.2624 per therm.
It is also noted that, as of Nov.6, the gas supply charge
"for the winter" is $1.2424.
Is this a good idea do you think? I will need to guess
whether gas prices will go up in the NE. I do know that
the NE is expected to be colder than normal this year.
Your ideas would be much appreciated!
Thank you.
Frank

No one knows and whoever thinks is just speculating. Utility
companies who set these options up are more likely to make more money
than lose, else they would not do it.

...else they would not do it.

I don't know the answer to this question, but I wonder how many of the
utilility companies are forced to offer pricing options by whatever
utility board they have to answer to?

Since the possibility exists for them to lose money (e.g. *everyone*
chooses the fixed option and prices rise) I wonder how many of the
options are offered because they have to be.

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They just buy futures to cover them if the price goes up. No risk is
involved for the utility.

And if the price goes down ... they don't lose money on the futures? Wish I
could find some like that.