Understanding Natural Gas Pricing for Laundromats in Middle Tennessee: A Guide for Budgeting and Dryer Pricing

Running a laundromat means keeping a close eye on operational costs — and for most stores, natural gas is one of the top expenses, right alongside other utilities, rent, and labor. In Middle Tennessee, many laundromats are served by Middle Tennessee Natural Gas Utility District (MTNG), and the pricing structure is straightforward but has a few moving parts owners need to understand.  For laundry owners outside of Middle Tennessee, this model still holds true, but the exact pricing may vary.  Using this specific example should help laundry business owners understand how to better calculate the costs behind operating their dryers.

This article breaks down how MTNG charges for gas, shows three usage examples common in laundromats, and projects 10-year costs so you can plan pricing for tumble dryers and overall operations.

1. How MTNG’s Small Commercial Rate Works

MTNG laundromats typically fall under Rate 35 – Small Commercial (effective May 1, 2025). Charges have three main parts:

Customer Charge – A fixed monthly fee:

$20.50/month (billed regardless of usage)

Usage Charge – The base per-therm rate for all gas consumed:

$0.775 per therm

Purchased Gas Adjustment (PGA) – A monthly adjustment reflecting the market cost of gas:

May 2025 PGA: $0.170 per therm

(A therm is 100,000 BTU — about what one medium tumble dryer might use in an hour.)

Taxes (like Tennessee’s ~7% sales tax) may apply, depending on your location.

2. Current Monthly Cost Examples

Below are three example usage levels for laundromats, calculated with MTNG’s current base rate and PGA.

Monthly Usage (therms)	Base Usage Cost ($0.775/therm)	Customer Charge	PGA ($0.170/therm)	Total Before Tax	With 7% Tax
1,400	$1,085.00	$20.50	$238.00	$1,343.50	$1,437.54
1,650	$1,278.75	$20.50	$280.50	$1,579.75	$1,690.33
2,000	$1,550.00	$20.50	$340.00	$1,910.50	$2,043.24

These totals assume May 2025’s PGA rate. Because the PGA changes monthly, your actual bill will fluctuate, even if your usage stays steady.

3. Why the PGA Matters

The PGA is what causes seasonal and market-driven swings in your bill. For example:

• If wholesale gas prices spike in winter, the PGA can increase sharply, raising your bill without any change in your dryer usage.
• If prices fall (like during some summer months), your bill can dip accordingly.

Pro tip: Track the PGA each month from MTNG’s Rate Sheets so you can forecast near-term costs.

4. 10-Year Cost Projections

To budget long-term, it’s smart to plan for price escalation. Below, we’ve projected each usage level under three growth scenarios:

• Flat – No change in rates (unlikely, but shows a floor)
• +2%/year – Reflects moderate inflation and market growth
• +4%/year – High case, reflecting sustained higher market prices

All projections start from current totals before tax.

Usage (therms)	2025 Base Cost	2035 @ 0% Growth	2035 @ +2% Growth	2035 @ +4% Growth
1,400	$1,343.50	$1,343.50	$1,638.27	$1,989.18
1,650	$1,579.75	$1,579.75	$1,926.91	$2,339.97
2,000	$1,910.50	$1,910.50	$2,332.93	$2,837.74

5. Using This Info to Price Dryer Cycles

Dryer vend prices are often set too low because owners underestimate gas cost per cycle.

Example for a store using 1,650 therms/month:

Find total therms per cycle:
Suppose you have 24 pockets running 50% of open hours; that’s ~825 hours of total dryer operation a month.
1,650 therms ÷ 825 hours ≈ 2 therms/hour per dryer bank.

Find gas cost per cycle:
At $1,579.75/month, that’s ~$1.91/hour for gas. If a cycle is 30 minutes, the gas cost alone is ~$0.96.

Add other costs & margin:
Include labor, rent, maintenance, and profit margin when setting vend prices.

Key Takeaways for Middle Tennessee Laundry Owners

• Know your usage – Track monthly therms; this will help forecast costs.
• Watch the PGA – It’s the biggest variable in your bill.
• Budget for increases – Use at least +2%/year in long-term planning.
• Price dryers with gas cost in mind – Don’t let underpriced cycles eat your margin.

So in Conclusion:

Natural gas pricing in Middle Tennessee laundromats follows a clear structure — a fixed monthly fee, a base per-therm rate, and a variable Purchased Gas Adjustment (PGA). By understanding how these pieces fit together and running the numbers for your store’s actual therm usage, you can better anticipate monthly costs, track seasonal swings, and plan for long-term increases. Using realistic 10-year projections ensures you’re setting dryer vend prices that protect your margins, even when energy markets fluctuate. The key is to stay informed, adjust as rates change, and make sure your pricing reflects the true cost of running your dryers.