Cold snap may affect some energy bills for South Dakotans

Published: Feb. 23, 2021 at 6:46 PM CST
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CROOKS, S.D. (Dakota News Now) -Millions of people are still dealing with the fallout from last week’s winter storm. Some Texans are seeing electric bills skyrocket after the energy crisis. That’s prompting some South Dakotans to wonder if they’ll see any changes to their energy bills.

If you use more electricity than you normally do that can cause your bill to go up. But if you’re an Electric Power Cooperative Consumer in South Dakota with East River or Basin you won’t be seeing increases like some Texans are as the rate of your bill will remain the same.

“If prices are really low, you know our generation doesn’t run as much, but we’re paying low prices. If prices are very high, we’re selling a lot of our generation into the market, we’re also paying those higher rates as well. And so it all kind of evens out in the end,” said Chris Studer, Public Relations Officer for East River Electric.

On the natural gas side, some folks could see their bills go up. The significantly cold weather associated with Winter Storm Uri affected natural gas supplies across the country, raising prices for fuel used in electric generation and home heating.

It’s especially a concern in Garretson, Humboldt, and Crooks, where the natural gas companies are municipally owned.

“If you’re paying a dollar a gallon all the sudden we went up to 200 to 300 dollars a gallon,” said Crooks Mayor, Butch Oseby.

Because of this price increase, Mayor Oseby warned residents to conserve energy. While some did, the mayor still expects to see a big bill.

The city is locked in at 75 percent of its historic average for natural gas. Since it was cold customers used more gas than that, so it had to be purchased on the open market, which spiked in price.

“I would say for one month’s bill, we could be looking at what we might pay for a whole season. I mean that’s how high it could be for those five days, critical days. As of today we don’t know but by a week from today we should know” said Mayor Oseby.

“For a small public utility, this could be devastating.”

He says there will be a city meeting held before residents are sent their bill to see if there’s anything the city of Crooks can do to offset the costs. This would affect over 900 customers.

NorthWestern Energy and other South Dakota energy companies worked with the South Dakota Public Utilities Commission to address the impact on South Dakotans’ natural gas bills.

On March 1st, NorthWestern customers will see an increase on their bill labeled as “Purchase Gas Commodity.” The higher cost will be spread out over 12 months. NorthWestern’s rate to deliver natural gas to customers will not change.

Anyone concerned about being able to pay a higher energy bill can contact NorthWestern Energy’s customer service department at 800-245-6977. Customer Service Representatives can offer payment plans and provide referrals to energy assistance programs.

We reached out to the city of Sioux Falls about residents gas bills and received this statement from Utility Billing Supervisor Dan Friedbauer:

“Our rates are set and approved by council and will not see an increase until 2024 outside of the already posted rates in ordinance.”

“Rates were set back in 2017/2018 for an approved 5 year rate increase approved by council. We will revisit this in 2023 for a similar rate increase period. Our rate models forecast for a number of factors that ensure each city-owned utility is covering the true cost to operate each utility. These factors include: operation, maintenance, capital projects and improvements and debt service requirements.”

We received this statement from Xcel Energy:

“Our teams worked hard to prepare for the cold weather that affected the central United States last week, and those preparations paid off as we provided the critical service our customers needed to remain safe and comfortable. While we expect there to be some impacts due to the high natural gas prices during the cold snap, we’ll work with our regulators and stakeholders to minimize the effects of those prices on our customers.”

We received this statement from MidAmerican Energy:

“From February 5-18, our customers used about 50 percent more natural gas than normal for that time period. Higher demand plus higher market prices for natural gas will impact our customers’ energy bills. We’re not yet able to quantify how this week’s events will affect average residential customer bills, though we should have that information soon.

The costs of the gas we purchase from suppliers and deliver to each customer, as well as the amount of energy that a customer uses, both help determine the amount of the customer’s natural gas bill. We pass on to customers only the cost we pay for the natural gas without markup.

Before the cold snap hit and market prices surged, we served our customers by taking actions to help mitigate the recent cost spikes. Those efforts included storing natural gas and liquified natural gas, as well as entering into advance gas purchase contracts that locked in pricing when market prices were lower.

We are working with regulators in the states we serve to find ways help our customers. That includes exploring the possibility of spreading costs over a longer period of time to help lessen the financial burden on our customers. Today we met with the South Dakota Public Utilities Commission to discuss a proposal to spread out the cost recovery payback period until December. And we will be meeting with the Iowa Utilities Board on March 12 to discuss cost recovery options for our Iowa customers.”

MidAmerican encourages any customer who is experiencing financial difficulties to call 888-427-5632 to discuss payment options.

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