Kansas Gas customers will pay more to heat their homes this year. Here’s why — and how much

Households that rely on natural gas for heating are projected to spend 28% more on fuel costs this winter than last, according to the U.S. Energy Information Administration.

“Recently, because of supply constraints, gas prices have hit sustained highs that we haven’t experienced in at least the last 20 years,” said David Nickel, consumer counsel for the Kansas Citizens’ Utility Ratepayer Board.

For Kansas Gas Service customers, the uptick in gas prices will coincide with a new monthly charge that will be added to utility bills for 10 years as the company works to recoup money lost during winter storm Uri in February 2021.

Starting in December, KGS customers will pay an additional $5.64 for the next six months and $5.11 per month for the following nine and a half years. The Kansas Corporation Commission approved the new charge in August.

“We recognize these increases, along with routine adjustments, come at a time when customers are facing challenges from increasing bills across the board,” said Dawn Tripp, a KGS spokesperson. “We want our customers to know that we are here to help those who may have difficulty paying their utility bills.”

The price of natural gas skyrocketed from about $3 per dekatherm to as high as $622 during Uri, when 28 companies hijacked enough natural gas from KGS to heat about 200,000 homes. Those firms could have faced a theoretical maximum of $888 million in gas costs and penalties but bargained their way down to $65.4 million.

Because that settlement was approved by state regulators, $313.7 million of KGS’ $366 million in extraordinary costs from the disaster will be passed on to the company’s 640,000 customers.

“After an extensive review, the Kansas Corporation Commission approved our plan to reduce the financial impact on customers by issuing securitized bonds,” Tripp said. That “allows the extraordinary gas and other related costs of the storm to be paid over a longer, more manageable timeframe, which results in lower monthly customer bill impacts.”

KCC Director Linda Berry told The Eagle that the bonds were priced last Thursday and KGS filed the required issuance advice letter with the commission.

Without this step, Tripp said, customers would have paid more than $500 extra on their April 2021 bills.

“Like most utilities, Kansas Gas Service experienced unusually high natural gas demand and a significant increase in natural gas market prices during Winter Storm Uri,” Tripp said.

Gas companies and electric utilities paid as much as 200 times the normal price for natural gas during the disaster rather than leave customers to freeze in the dark with no service.

Tripp said KGS, a division of Oklahoma natural gas giant ONE Gas, does not mark up the price they pay suppliers for natural gas.

“It is passed through to the customer at our cost, and we continuously work to secure the lowest gas prices for our customers,” she said.

KGS is sharing the following tips for conserving energy this winter:

  • Air seal your home with caulking and weatherstripping

  • Set the temperature on your water heater to 120 F or the “warm setting”

  • Replace or clean your heater’s air filters

  • Have a qualified contractor inspect your heating and cooling equipment annually

  • Change the rotation of your ceiling fans