Minnesota utility working to ease burden from gas bills

Utility company CenterPoint Energy, which caters to the Minnesota market, told a state regulator this week it was adjusting its payment protocol to lessen the impact of the February spike in natural gas prices.

In a filing with the Minnesota Public Utilities Commission, the company said it racked up a US$500mn gas bill over a 10-day period in February. Reporting from regional newspaper Star Tribune estimated that this was 56% more than bills over the full year ending June 30.

"The February market conditions were extraordinary, and as a result, so were the costs incurred," CenterPoint said in the filing.

Henry Hub, the US benchmark for the price of natural gas, hit $23.86/mn Btu last month due to an extraordinary spike in demand brought on by the cold snap. Sub-freezing temperatures in Texas, meanwhile, suppressed operations in the region’s shale natural gas basins and at refineries.

Henry Hub was closer to $2.50/mn Btu in trading on March 17. Star Tribune reported the spike in natural gas prices translated to a $354 gas bill for each household on average. The company said it would try to spread that burden out over the next two years.

"We are trying to ease the impact," CenterPoint spokesman Ross Corson was quoted as saying.

Two other gas providers, Xcel Energy and MERC, estimated their consumer bills were in the range of $250 last month, though neither has filed with the state utility regulator on plans for consumer debt relief.

The PUC opened an investigation into the spike in gas prices last month. Unlike Texas, state consumers had a reliable source of heat and power during the February cold snap. That said, utilities were buying gas at prices that were at least 50 times higher than average.

“As regulators, we will use every tool available to mitigate the impact to Minnesota utility customers,” Katie Sieben, the chair of the PUC, said in a February statement.