Energy price pass-through receives a lot of academic attention, for several reasons: energy prices can be highly volatile, they impact every consumer and every industry in the economy, and they are frequently impacted by regulations including gas taxes and carbon regulations. Like the pass-through literature in general, the energy pass-through literature focuses on pass-through to marginal prices. However, multi-part pricing is common in energy retail pricing. In this paper, I examine pass-through to retail natural gas prices. I show that marginal prices exhibit one-to-one pass-through, but fixed fees exhibit negative pass-through. This is consistent with the stated desire by utilities and price regulators to prevent "bill shock." The results have implications for how pass-through is estimated, as well as for understanding the implications of proposed alternative pricing structures for regulated utilities.
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