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Archive for Wednesday, December 1, 2010

Natural gas prices expected to be 30 percent lower this winter

December 1, 2010

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Lawrence residents should see lower natural gas bills this winter, if Mother Nature will just cooperate a little bit.

Natural gas prices are projected to be about 30 percent less this winter than last winter, city leaders were told Wednesday at a luncheon hosted by Black Hills Energy. Now, everyone will just need to watch the weather.

“If it doesn’t get any colder than last year, people will have lower bills this winter,” said Curt Floerchinger, a spokesman for Black Hills Energy, which is the major natural gas provider in the city.

Black Hills leaders said the natural gas market is in a favorable trend, and there are signs that natural gas prices may not be as volatile as they have been in past years.

“It used to be that you saw a strong correlation between the price of natural gas and the price of oil,” said Steve Hanna, director of operations for Black Hills’ Kansas operations. “But we don’t see that correlation like we used to.”

Hanna said the natural gas market is changing as new technology is developed to extract more gas. In particular, the rush to extract natural gas from shale has opened up new areas of the country for natural gas exploration. More energy-efficient building practices also have homes using less gas than in decades past.

“We think it adds up to what should be some good gas prices for the winter,” Hanna said.

In other news, Black Hills officials announced:

• Plans are in the works to install a compressed natural gas fueling station in the city. The company plans to have the fueling station open by the end of the year at its Eighth and Pennsylvania work yard. The station, which will provide fuel for new vehicles that run off of compressed natural gas, won’t be open to the general public. Instead, it will be used by the company as it begins to convert its fleet over to compressed natural gas. Blacks Hills leaders, though, said they would be open to discussing how other large users like the city of Lawrence or Kansas University could take advantage of the station in the future.

• Work is under way to convert all of the natural gas meters in the city to electronic devices that can be read remotely. A $3 million project to convert the meters should be done by March. Once completed, the company will be able to read meters simply by driving up and down a street. A specially equipped van will collect the electronic readings. The project will cause the company to reduce its local meter-reading staff from four positions to one. The company is working to find jobs for those employees either within Black Hills or with other companies in the Lawrence area.

Comments

mrbig 4 years ago

We converted our shop to all electric after our $350/month gas bill during the winter months courtesy of Black Hills Energy. Then when I wanted to shut it off to avoid the $30/month charge for not using any gas at all in the summer months- they said if I did that they would charge me more than I would have saved as an additional fee when I got it turned back on. So, I told them I was getting an electric furnace and to shut off our service. 3 months later they come shut it off, and take those 3 months out of my deposit refund. When I called to inquire they said a supervisor had to call me back- which never happened. Scandelous.

just_another_bozo_on_this_bus 4 years ago

Minimum charge for residences is $18 a month, whether any gas is used or not. And you can't just disconnect for the 4-5 months of the year when no heating is required. The claim is that this is what it costs to "maintain the system."

How realistic that amount is I've no way of knowing, but I suppose there is some merit in it. However, it would seem to me that that "maintenance charge" could easily be calculated and collected only on active accounts, and not charging for accounts in which the gas company does nothing bet read a meter that hasn't moved since the last time they read it.

Adrienne Sanders 4 years ago

Seems to me it would take the same amount of effort to read a meter that hasn't moved as it does to read one that has....

just_another_bozo_on_this_bus 4 years ago

True. But it takes no effort at all to not read a meter.

With the new meters going in, where service is discontinued for the warm months, the gas can likely be shut off without even getting out of the truck, and the meter won't need to be read again until service is reconnected.

mrbig 4 years ago

It's commercial, and then add taxes and fees on top of it. We have a large shop where the door is usually open so we only heat for about 3 months of the year so our pipes don't freeze overnight. So that's 9 months of the year they wanted me to pay $30= $270 for not using their service.

LogicMan 4 years ago

Um --- electric heat is about three times as expensive as natural gas, unless you put in a heat pump (but it still switches to ER in cold weather), or negotiated a dirt-cheap rate with Westar and not just a slightly lower "all-electric" rate.

So unless you keep your temperature much lower, etc., get ready for some stunning bills for January and February. Especially if you also pay a demand charge.

Might want to hire a pro to evaluate your situation, next time.

Don Whiteley 4 years ago

Knowing energy suppliers, what Black Hills likely means is that if the average temperature in Lawrence is above 70 for the months of December through March, then gas prices should be 30% lower.

somedude20 4 years ago

Well, with food prices going up I bet it costs me 20% more to create my own natural gas

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