Inventory-related adjustments

Gaz Métro must store natural gas in the summer in order to serve customers in the winter. This entails additional costs to procure the supply and transport it to the storage location.

Inventory adjustment tariff

The natural gas supply price at the time the natural gas is stored may be different from the price that will be in effect when it is consumed by customers. As the prices charged are those in effect when the natural gas is consumed, the difference is billed or credited by means of an inventory-related adjustment.

Two customer consumption parameters are used to calculate the volume in stock:
  • the average daily winter consumption (W);
  • the average daily annual consumption (A).

Calculation of a customer’s inventory volume

Calculation of a customer's actual volume

The inventory costs are closely linked to the load-balancing costs. This method of adjusting costs in relation to inventory must also take customers’ consumption profiles into account. For customers, this means that the greater the difference between winter volumes and annual volumes, the greater the impact on inventory costs.

Since parameters A and W are based on consumption history, those who have been customers for fewer than 12 months will be billed at the average applicable distribution rate. Customers under the general distribution service D1 are also billed based on an average rate. For these customers, the inventory adjustment calculation is based on an overall inventory established for all customers subject to this rate.

Furthermore, customers that use another supplier to transport and supply natural gas are not billed for the inventory adjustments that are associated with the price of these services.

Where to find it on the bill?