02/24/2021
Severe cold weather in large portions of the U.S., primarily the Midwest and Southwest, has led to historic increases in the price of natural gas. Natural gas, which was selling for around $3 per MMBtu has skyrocketed to over $300 per MMBtu, and in at least one case, over $1,000 per MMBtu. These prices are over 100 times greater than the price of natural gas in the beginning of February.
Multiple factors have led to these unprecedented increases. First, the severe cold weather forced shutdowns in natural gas production in areas not typically accustomed to cold weather. In addition, the severe cold weather led to increases in natural gas demand, which has placed strains on the market given the weather-related reduction in production.
These price increases, along with the increases in demand have placed strains on public natural gas systems, which had no choice but to purchase gas at the inflated prices or pay even steeper penalties to ensure that their customers could continue to heat their homes. In one case, a municipal utility spent its monthly
gas budget each day over President’s Day weekend. In another instance, a joint action agency expended three times its annual gas purchasing budget just to buy gas for its customers for four days.
In response to this crisis, our natural gas system has worked with our national association, the American Public Gas Association, to formally request that the Department of Energy and the Federal Energy Regulatory Commission begin an immediate investigation into the unprecedented rise in natural gas prices. We believe it is critical to ensure that the increases in the price of natural gas were
the result of market forces rather than manipulation or profiteering. Our customers and communities must be protected from unwarranted price increases.
Our natural gas system has also worked with APGA to send a letter to President Biden supporting an Emergency Disaster Declaration for impacted regions of the country. We have also requested that federal funding be made available to assist public natural gas systems and their communities to help mitigate the impact of the historic price increases we have experienced.
We are doing everything we can to keep the cost as affordable as possible for our customers. We understand the hardship this may cause and are offering to setup payments plans for the unusually high bills. If you have any questions or concerns, you can call or email us at:
651-923-5306
[email protected]
