NASHVILLE, Tenn. (WSMV) – Gallatin Public Utilities is addressing the questions they have received from residents after they received higher-than-normal natural gas bills following the recent ice storm.
GPU’s Superintendent David Kellogg said the two primary factors of the increases.
“Customer usage increased roughly 40% during that period,” Kellogg said. “We experienced a week and a half to two weeks of below-freezing temperatures, which naturally increased heating demand.”
Additionally, the wholesale cost of natural gas increased during the cold snap.
“GPU purchased natural gas for January at $4.4687 per dekatherm, compared to $3.514 per dekatherm in January of last year. For February, the market price rose to $7.46 per dekatherm,” GPU said.
Due to the natural gas bill being based on monthly market rate at the time of billing, GPU said some January usage rolled into the February bills.
Kellogg emphasized that this was not a rate increase.
“This was not a rate increase approved by the utility,” he said. “It was a rate adjustment based strictly on the actual cost of purchasing natural gas. That cost fluctuates every month depending on market conditions.”
Kellogg also said that prices are going down, and that GPU purchased natural gas at $2.97 per dekatherm recently, which should be reflected on upcoming bills.
“Natural gas pricing is cyclical,” Kellogg said. “It goes up and it goes down. Most of the time it remains fairly stable, but extreme weather events can create short-term volatility. By purchasing gas at market prices instead of locking customers into long-term fixed contracts, we’re able to take advantage of lower prices when they occur, which ultimately saves money for our customers and taxpayers over time.”
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