June 18, 2021

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Core Demand, the residential and commercial sectors, primarily uses natural gas for winter heating loads.

As illustrated in the chart, core demand correlates well to Heating Degree Days (HDD) with yearly swings resulting from warmer or cooler temperatures. A heating degree day (HDD) is a measurement designed to quantify the demand for energy needed to heat a building. It is the number of degrees that a day’s average temperature is below 18 degree Celsius, which is the temperature below which buildings need to be heated.

Customer counts drive underlying Core demand growth of 0.4%/year. Efficiency factors on a normalized basis (Mcf/Customer/HDD) have steadied over the last decade, however, Incorrys is forecasting continued efficiencies of 0.1%/year.

Efficiency factors include new building standards, opportunities to use modified technology applications such as adjustable smart digital thermometers, and conservation measures in existing housing stock (insulation, new windows).