The bill H. 5328 aims to amend the South Carolina Code of Laws by adding Article 12 to Chapter 5, Title 58, which mandates that public utilities providing natural gas distribution services to residential customers establish and maintain a "natural gas price reserve." This reserve is intended to mitigate the rate impact of extraordinary natural gas costs, defined as wholesale gas costs that exceed historical seasonal averages. The funding for this reserve will come from modest per-therm surcharges during nonemergency periods, excess margins from favorable pricing years, and revenues from natural gas capacity releases. The bill stipulates that the funds in the reserve can only be used to offset extraordinary costs and may be utilized over multiple billing cycles to prevent immediate rate shocks to customers.

Additionally, the bill requires public utilities to submit an annual report to the Public Service Commission detailing the usage of the natural gas price reserve, including the amount of funds utilized, the fund balance, and the impact on residential customer rates. It also specifies that costs for the reserve cannot be recovered from residential customers in a single billing cycle unless the Public Service Commission provides written findings justifying the necessity for immediate cost recovery. This legislation is designed to provide a structured approach to managing natural gas pricing fluctuations and protecting residential customers from sudden increases in their utility bills.