Today, we announced net income of $0.3 million or $0.02 per share for the third quarter of 2020.
The company estimates that the ongoing COVID-19 pandemic unfavorably impacted third quarter net income by approximately $0.01 per share.
Through the first three quarters of 2020, net income is $18.6 million or $1.25 per share.
For comparison purposes, recall that in the first quarter of 2019, the company recognized a onetime net gain of $9.8 million, or $0.66 per share, on the company's divestiture of its nonregulated business subsidiary, Usource.
Adjusting for this onetime gain, net income is down about $4.4 million or $0.29 per share compared to 2019.
The year-to-date decrease in earnings is primarily due to the warmer than normal winter weather in Q1, which unfavorably affected net income by approximately $3.1 million or $0.20 per share.
In addition to the warmer winter weather, we estimate that net income has been unfavorably impacted by approximately $0.04 per share due to the COVID-19 pandemic.
The positive test rates in each of our states rank in the lowest 10 of all 50 states.
We estimate that the impact over the last 10 years from our customers choosing natural gas rather than home heating oil has had the impact of taking roughly 60,000 cars off the road.
Nearly 2/3 of main households still rely on fuel oil as their primary energy source for home heating, a larger proportion than in any other state in the United States.
In New Hampshire, more than 2/5 of households rely on fuel oil, the second highest proportion of the nation behind Maine.
As a result, we decreased our fugitive emissions from natural gas distribution by 47 metric tons over the last two years, lowering our total generation of fugitive greenhouse gas emissions by 9% in 2019 when compared to 2017.
In fact, our safety metrics place us in the top 1/3 of our industry peers and have continued to improve over time.
We believe the framework we've established from employee relations has been successful as backed by a recent employee survey where 90% of our employees report being proud to work for Unitil.
In fact, compared to the prior year, we have increased our capital investment by more than 20%.
This energy storage system has the ability to serve over 1,300 homes for over two hours and is designed to reduce peak loading on the substation equipment.
This project has a capacity representing over 2% of our system peak in Massachusetts and offers a solution to advanced grid operations control cost variability and aid in the overall system reliability as we support renewable energy solutions.
Year-to-date 2020, our electric gross margin was $70 million, a decrease of $0.6 million compared to 2019.
We estimate the COVID-19 pandemic unfavorably affected electric margin by approximately $0.7 million.
Through the first nine months of 2020, total electric kilowatt hour sales increased 1.2% relative to 2019.
Residential sales increased 8.2% primarily reflecting stay at home orders and continuing remote work, along with warmer summer weather relative to the prior year.
C&I sales decreased 3.6%, reflecting lower usage due to the COVID-19 pandemic.
For the first nine months of 2020, our gross gas margin was $83.3 million, a decrease of $2.2 million over 2019.
The company estimates that year-to-date gas margin was lower by $3.2 million due to warmer weather.
We also estimate that the COVID-19 pandemic unfavorably affected gas margin by $1.3 million due to lower commercial and industrial usage.
Those unfavorable variances were partially offset by higher distribution rates and customer growth of $2.3 million.
Through the first nine months of 2020 natural gas therm sales decreased 7.1% compared to 2019.
The company estimates that weather-normalized gas therm sales, excluding decoupled sales, were down 1.9% year-over-year.
I also note, we currently are serving 2.9% more gas customers than in the same time in 2019, illustrating our growing customer base.
As I noted, 2020 year-to-date gross margin -- excuse me, gross sales margin is lower than 2019 by $2.8 million.
Core operation and maintenance expenses decreased by $0.9 million compared to the same period in 2019.
This decrease primarily is due to lower employee benefit costs of $1.2 million as well as lower maintenance expense of $0.3 million, partially offset by higher bad debt expense of $0.4 million and higher professional fees of $0.2 million.
Depreciation and amortization was higher by $1.7 million, reflecting higher levels of utility plant and service.
Taxes other than income taxes increased by $0.9 million, reflecting property taxes associated with higher levels of net plant and service and a nonrecurring tax abatement realized in 2019 of $0.6 million, that increase was partially offset by $0.6 million of payroll credits realized in the third quarter associated with the Coronavirus Aid, Relief and Economic Security Act, also known as the CARES Act.
Interest expense decreased by $0.2 million, reflecting lower interest rates on short-term debt.
Other expense increased by $0.4 million due to higher retirement benefit costs.
Next, we've isolated the full Usource effect of $10.3 million, which was realized in 2019.
This includes the after-tax gain on the divestiture of $9.8 million and $0.5 million, reflecting the net of revenues and expenses realized through Usource operations in 2019.
Lastly, income taxes decreased $0.8 million, reflecting lower pre-tax earnings in the period.
As Tom mentioned earlier, we estimate that the COVID-19 pandemic affected earnings per share by $0.01 in the quarter, bringing the year-to-date effect to $0.04 per share.
The combined effect on gas and electric sales margin was $0.8 million in the third quarter of 2020 and $2 million year-to-date.
Year-to-date O&M expenses have been favorable by $0.7 million.
As noted earlier, the company was able to lower taxes other than income taxes by $0.6 million by recognizing payroll tax credits associated with the CARES Act.
In the third quarter, we received proceeds of $95 million of long-term debt.
The debt was placed at our regulated subsidiaries and carries an average interest rate of 3.72% with a 20-year tenor.
As a result of the financing, we have liquidity of about $161 million, enabling the company to continue executing on our long-term plan.
On Slide 15, we are pleased to announce that our gas transmission pipeline, Granite State Gas, recently filed an uncontested rate settlement with the FERC providing for an annual revenue increase of $1.3 million, with rates to become effective in the fourth quarter of this year.
If those mechanisms are approved, the percentage of our decoupled sales to total sales would increase from approximately 25% to 75%, and over 80% of our meters would be under decoupled rate structures.

Summary:
Today, we announced net income of $0.3 million or $0.02 per share for the third quarter of 2020.