Natural gas costs rising again for Joplin residents

Andy Ostmeyer is the metro editor at the Globe. He is a graduate of Kansas State University who has worked at the Globe for 38 years. His email address is aostmeyer@joplinglobe.com., The Joplin Globe, Mo.
·4 min read

Jan. 21—Natural gas rates for residential and business customers in Southwest Missouri are going up again.

The Missouri Public Service Commission last week announced that the cost of gas for Spire West customers will go from 92 cents per ccf to $1.07 per ccf. A ccf is a hundred cubic feet of natural gas and a unit to measure usage, and how much more each customer will eventually pay will also depend on their usage through the winter.

In a statement Spire officials said the latest increase will be about $9.54 per month, or 9.38%, for that typical customer.

"This increase is due to dramatically higher natural gas costs during Winter Storm Uri in February of 2021. Gas costs from that nine-day period were what Spire typically spends on gas in a year. While there was a previous gas cost increase due to Uri, a large sum of those gas costs was deferred over time to lessen impacts on customer bills. This increase is to recover those costs," the utility said in a statement.

This follows an increase in gas costs passed along in November, from 79 cents to 92 cents per ccf. That broke down for an average residential customer of an increase of $8.14, or 9.16% per month, according to Jason Merrill, spokesman for Spire.

And that follows an announcement in November 2021 when Spire West customers saw the cost of gas double, going from 40 cents per hundred cubic feet of natural gas used to 79 cents.

The utility said that reflected the price increase that the natural gas market has experienced starting with the severe weather event in February 2021, when gas traded at $200-$600/MMBtu compared to normal prices in the $2-$6/MMBtu range. An MMBtu represents 1 million British thermal units and is a way natural gas is measured for financial contracts.

That change meant an increase of about $24.36 per month, or 41.5%, for the typical natural gas residential customer, defined as someone who uses an average of 60 to 65 ccf per month.

In all, those three increases over a 14-month period raised the cost of gas for the typical customer by more than $42 per month, or more than $500 per year.

Unregulated

In a statement, the PSC said the wholesale cost of natural gas is not regulated by the state, and that cost is "primarily driven by supply, demand and the weather." The PSC does conduct a review to make sure that regulated natural gas companies such as Spire make prudent decisions in securing natural gas supplies for their customers.

Spire has said it does not make any profit from the increase in prices for natural gas, but merely passes those along to customers.

The cost of natural gas from wholesale suppliers makes up about 50% to 55% of a customer's total monthly natural gas bill, Merrill has said previously.

In December, the PSC also announced an increase in the non-gas part of the bill had been approved by regulators. The PSC authorized Spire to raise its revenues by $78 million, with new rates to take effect between Dec. 26 and Jan. 1.

The typical residential gas customer in Western Missouri saw their monthly bills increase by 4.9%, or $4.76 per month, according to Merrill, bringing the total increase in the typical customer's bill to nearly $47 per month.

Spire had sought a net increase in revenue of nearly $152 million when it filed with regulators last April. Under that original proposal, the typical customer in western Missouri would have seen an increase of $10.95 per month, or 12.65%.

This rate case covers "non-gas" costs for Spire customers, which the PSC defines as operating and maintenance expenses, and recovery of investments the company has made, such as new lines.

Under the agreement, Spire also changed the name of its Low-Income Energy Affordability Program to the Payment Partner Program, and increased shareholder contributions to the program by $1 million in addition to existing contributions, bringing the total funding of the program to $3.3 million. In addition, eligibility for the Payment Partner Program will be expanded to 300% of the federal poverty level through April 30.

According to the Consumers Council, which intervened in the case on behalf of Missouri consumers, Spire also will provide an additional $500,000 (funded equally by ratepayers and shareholders) to its Critical Needs Program, which is designed to protect customers who are seriously ill from gas service disconnection.

In a statement, Spire officials said those struggling with payments can learn more about assistance programs and eligibility at spireenergy.com/assistance.

Andy Ostmeyer is the metro editor at the Globe. He is a graduate of Kansas State University who has worked at the Globe for 38 years. His email address is aostmeyer@joplinglobe.com.