A New Charge Is Showing Up On Minnesota Natural Gas Bills
Download the KRFO-AM Mobile App Now
Rochester, MN (KROC AM News) – Most Minnesotans are noticing a new charge on their latest natural gas bill.
It’s called the “Severe Weather Cost Recovery Charge” and will result in a higher bill.
The extra cost is coming at the same time gas prices are twice as high as they were a year ago.
Here is a bill from November 2020 highlighting the purchases gas adjustment”
Here is a bill from November 2021. Notice the purchase gas adjustment cost is nearly 3 times higher than a year ago.
The result will be much higher bills through the winter unless prices suddenly fall. Minnesota Energy warned customers last month about higher bills, predicting “the typical residential customer will pay $44 more a month this winter compared to last year. The analysis assumes typical winter weather.”
But bills will also be higher because of the new surcharge.
The extra cost is related to the cold weather that affected energy companies during the “polar vortex” that was experienced across much of the country in February. Energy companies in Texas were especially hard hit, including natural gas operators. That led to historic price spikes that cost Minnesota suppliers several hundred million dollars. The Minnesota Public Utilities Commission in August approved a cost recovery plan that will spread the extra costs over two years.
The Commission also ordered a contested case hearing to evaluate whether the utilities acted reasonably during the price spike event and whether the extraordinary costs are reasonable. To ensure that Minnesota is prepared for future weather events, the Commission also directed the creation of a public stakeholder group to evaluate policy and rule changes that could protect Minnesota ratepayers from future potential weather-related price spikes and market disruption.
During the meeting, PUC Chair Katie Sieben issued this statement:
“Without our action today, customers would have paid hundreds of millions in additional costs over the next year. Considering the ongoing pandemic, this decision is deeply consequential for ratepayers. Further examination of the costs incurred during the polar vortex is necessary to ensure utilities acted in a reasonable manner.”
According to the PUC:
The plan includes a measure exempting low-income residential customers who received Energy Assistance, or who are 60 to 120 days behind on natural gas bills from the extra charges resulting from the natural gas price spike. The commission urges consumers to continue applying to the Energy Assistance program, or to enter a payment plan to avoid disconnection.
There is one break for natural gas customers. State and local sales taxes are not assessed to bills between November and April.