The gas supply charge on your Nicor Gas bill represents the cost of the natural gas commodity itself. Unlike delivery charges, which are relatively stable, the supply charge fluctuates monthly based on wholesale market prices. Understanding how this charge works is key to managing your natural gas costs.
As of January 2026, Nicor's gas supply charge is $0.42 per therm—significantly higher than the $0.28/therm rate from January 2025. These fluctuations can have a major impact on your monthly bill.
How Gas Supply Charges Are Set
Nicor purchases natural gas on the wholesale market and passes these costs through to customers without markup. The Illinois Commerce Commission (ICC) regulates this process to ensure customers pay only the actual cost of gas.
Each month, Nicor files a new gas supply charge based on:
- Current wholesale natural gas prices
- Storage costs and inventory levels
- Pipeline transportation costs
- Adjustments for over/under-recovery from previous months
Why Rates Fluctuate
Natural gas prices are influenced by many factors:
- Weather: Cold winters increase demand and prices
- Production levels: Drilling activity affects supply
- Storage levels: Low inventory can spike prices
- Export demand: LNG exports compete for domestic supply
- Economic conditions: Industrial demand affects prices
Historically, gas supply charges have ranged from $0.25/therm to over $0.70/therm, with the highest rates typically occurring in winter months.
Customer Select Alternative
Illinois customers can choose an alternative gas supplier through Nicor's Customer Select program. Alternative suppliers may offer fixed-rate plans that lock in a price for 12-24 months, protecting you from market fluctuations.
When comparing suppliers, look at the total cost including any monthly fees. Some fixed-rate plans may be higher than Nicor's current rate but provide price stability. The ICC maintains a list of certified alternative suppliers.
Tracking Gas Supply Rates
Nicor publishes its gas supply charge monthly on their website. Monitoring these rates helps you understand bill changes and decide whether to switch to an alternative supplier.
Historical rates show that summer months (May-September) typically have lower supply charges than winter months. If you're on budget billing, these fluctuations are smoothed out over the year.