Common Gas Plan Mistakes | Units, Fees & Delivery Months

Find the error before comparing the totals

Keep unanswered questions visible in the decision record. A useful comparison can conclude that more information is needed; it need not select an offer immediately.

Worked example: the apparent tenfold price difference

A hypothetical quote of $7.50 per MMBtu and another of $0.75 per therm have the same commodity price on an energy basis: one MMBtu equals ten therms. Comparing the printed numbers without their units would create a false tenfold difference. The equivalence says nothing about whether the contracts include the same fees or service obligations.

Normalize the rate, then align delivery months, quantities and included charges. If one quote is per Mcf, use the applicable heat content rather than treating Mcf as MMBtu. Finally, preserve the original quoted unit beside the normalized result so an approver can trace the arithmetic back to the written offer. A correct conversion is necessary for comparison, but it does not establish supplier eligibility or make an incomplete offer complete.

Reject false precision from unmatched units

EIA’s unit guidance distinguishes volume from energy and notes that heat content varies. A comparison that uses a national conversion factor in one offer and the actual bill factor in another can introduce a false difference. Keep the original unit, conversion basis and normalized result side by side. Do not round an intermediate rate so aggressively that a small apparent advantage is created. EIA: natural gas volume, heat content and energy units.

Use an exception register before ranking bids

Create separate unresolved items for missing fees, different start months, incompatible volume terms and unconfirmed utility acceptance. The ranking should indicate which offers are complete enough to compare. If a bidder provides only a commodity rate, model it as an incomplete scenario rather than declaring it the best total cost. Recheck the account after a move, tenant change or supplier rebranding. EIA: natural gas customer choice and eligibility.

A pre-approval reconciliation in both directions

Calculate each offer from the documented inputs, then trace every entered input back to the proposal or utility record. This catches a result that adds correctly but omits a fee. Ask a second reviewer to reproduce the normalized unit cost and identify any assumed zero. Test a lower-volume case, an account removal and a delayed start when those are material. Retain both the first calculation and the correction so the same misunderstanding does not recur at the next renewal.

Use the appropriate planning tool

Fee-adjusted offer comparison: Change the annual volume as well as the rate; note when a fixed-fee difference reverses the ranking.