If you’ve enjoyed a cool blast of fall air to go with the pumpkin spice-flavored everything now available across Springfield, your utility bills may leave you wishing for warmer weather in a few weeks.
Springfield City Utilities put out a statement Sept. 29, moments after the Springfield Board of Public Utilities met to discuss its monthly business. Fuel cost adjustments for natural gas and electric power were all over the conversations. Volatile prices mean gas and electric customers will likely pay more than expected on their winter utility bills, if they haven’t already planned ahead.
City Utilities Director of Rates and Fuels Krista Shurtz said prices for natural gas have effectively doubled since the start of 2022. She points to global events influencing the cost of natural gas, specifically, Russian invasion of Ukraine and a resulting boycott of Russian gas imports by many NATO countries and their allies.
“Natural gas prices have been extremely volatile since, really, the beginning of the year and even some into last year,” Shurtz said. “Following Russia’s invasion into Ukraine, we really did see globally an increase in demand for natural gas and an increase in pricing, because as Europe started looking for other sources of supply besides Russia, the pressure came to even the United States to export more liquid natural gas to Europe.”
Changes in natural gas supplies will change bills in Springfield, especially as the mercury in the thermometer drops and people heat their homes.
“This increase — which is about $40 per month is what we’re projecting that our customers will pay more — is entirely due to what we forecast to be higher natural gas costs this winter,” Shurtz said.
Springfield’s average residential customer will be charged a total of $112.83 for natural gas for the month, according to this online bill calculator. However, gas prices are adjusted monthly based on the projected costs and the projected sales in a given month.
“Our customer charge hasn’t changed from one year this winter to last, the commodity charge hasn’t changed, we’ve had no base rate increases, the recovery cost of prior period fuel costs is actually less,” Shurtz said.
How do I save money on my heating bill? (Click to expand story)
City Utilities offers a $50 rebate for homeowners who tune up the heating systems in their houses between now and Dec. 31. It also offered the below tips as winter unfolds:
City Utilities tips to save on home heating
- Save 3-5 percent of your heating and air conditioning costs for each degree you set your thermostat below your normal setting in the winter.
- Proper insulation helps keep your home warm during winter. Check the insulation levels in your attic, ceilings, exterior and basement walls, floors and crawl spaces to see if it meets recommended levels.
- You may be losing energy when heating your home through air leaks. Check for, then caulk and weather-strip, holes and cracks around your walls, ceilings, windows, doors, light and plumbing fixtures, switches and electrical outlets that can leak air into or out of your home.
- Clean or replace air return filters two to three times during the winter.
- Increasing lighting efficiency is one of the fastest ways to decrease your electricity bills. Turn off lights in rooms not in use; check lighting needs and use patterns for ways to use controls such as occupancy sensors, dimmers, or timers; and, replace heat-producing 75-watt incandescent bulbs with 20-watt compact fluorescent (CFL) bulbs, and receive the same amount of light for just a quarter of the energy – CFLs also last about ten times longer.
- Keep heating/cooling vents clean and unobstructed including arranging furniture for air to flow freely.
- Keep fireplace dampers closed tightly when not in use.
- Register for the CU My Account
- Did you know you can monitor your utility usage? Register your account and use your computer or the My Account app, to stay connected with your usage and receive other information from CU. My Account is available for Apple or Android devices.
CU buys gas for power generation
Springfield City Utilities Chief Financial Officer Amy Derdall warned the Springfield Board of Utilities about the rising cost of natural gas at a meeting on May 27. In September, she was back in front of the Board of Public Utilities to give more concrete dollar estimates to the cost of winter heating.
Derdall said that in August, natural gas prices exceeded $8 per therm. The cost has since fallen slightly, but the cost for City Utilities to buy gas is still higher than originally budgeted when the utility’s financial officers planned the year.
The cost of natural gas is also tied to the cost of electricity. Springfield has two turbine generators that run on natural gas at its Lake Springfield generation site. The generators do not run year-round but run to create supplemental electricity when demand is high.
“We’ve had some droughts globally, but particularly in the north, northwest of the United States, which has reduced hydropower, required additional natural gas for power generation, again driving up prices,” Shurtz said. “It really is a supply and demand-type conversation.”
Sub-zero temps created demand for heat
City Utilities natural gas customers’ bills are also subject to two cost recovery factors. One is the spread out recovery from costs incurred during Winter Storm Uri in February 2021, and the second is the anticipated spike in gas costs from now to March 2023.
On Feb. 14, 2021, outdoor temperatures in Springfield reached a high of 6 degrees. Low temperatures between -13 and -10 were reported around Springfield. Users consumed 125,504 dekatherms of natural gas that day, representing the single-day peak for the year. Springfieldians have been paying for the spike in demand from Winter Storm Uri ever since, on a 24-month recovery schedule to the tune of about 21 cents per month per therm.
The good news about Winter Storm Uri, Shurtz said, is that City Utilities is nearly done recovering from the financial hit it took from the storm.
“We have about $15 million more in February ‘21 prior costs to recover,” Shurtz said.