Natural gas costs expected to jump soon
A Colorado energy company has projected increases in the cost of natural gas this winter, including a 34 percent price hike this December.Xcel Energy, based in Denver, announced the projections last week, saying typical residential natural gas bills could increase 34 percent this December when compared with last year’s bills. That’s $43.04 more than the typical residential bill was in December 2004, the company said.For small-business customers, the difference could be $203.21 more than last December. The company has emphasized that the costs are passed to customers on a dollar-for-dollar basis and have nothing to do with profit for Xcel Energy. The actual natural gas prices to be charged by the company this year must be filed with the Colorado Public Utilities Commission in mid-November for approval.The price increases have nothing to do with damage to natural gas production from Hurricane Katrina, since the company asserts that Rocky Mountain natural gas prices have not experienced the full impact of the hurricane.One reason for the price increase is supply and demand, according to an article from Business Wire. When summer temperatures were higher than normal in 2005, there was increased demand for natural gas to run air-conditioning units. Natural gas companies usually can stock up during the summer to purchase gas for customers at a lower price.In the Roaring Fork Valley, Holy Cross Energy in Glenwood Springs buys natural gas from Xcel Energy for 25 to 30 percent of the power it provides – the rest is generated by coal, according to Holy Cross spokesman Bob Gardner. The local energy company already forecast a 40 percent increase in the cost of natural gas this winter season.Xcel Energy also announced its monthly gas cost adjustment for October of this year, but the company said the price change from September to October has more to do with a projected doubling of customer consumption when the weather gets cooler. Typical residential customers are expected to increase their use of natural gas to heat their homes by 104 percent in October and September, and because of a 16 percent increase in price, their gas bills should double next month.At Holy Cross, Gardner encourages customers to conserve energy by buying energy-efficient appliances, and the company offers cash-back rebates on purchase of Energy Star appliances like refrigerators and dishwashers.Naomi Havlen’s e-mail address is email@example.com
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