Minnesota's largest gas utility Centerpoint Energy has said the energy crisis caused by the February cold snap will see an extra $354 added to bills in the state.
In a filling to the Minnesota Public Utilities Commission, Centerpoint said the "extraordinary" market conditions in February cost the company $500 million between Feb. 12-22 just to maintain the gas supply for its Minnesota customers.
With the deep freeze also hitting states that are not used to it – such as Texas, Oklahoma and Arkansas – the demand for gas for heating and electricity skyrocketed. Gas supplies also throttled by the shutdown of plants and production operations in the south, which were unable to withstand the frigid conditions.
Centerpoint says in its filing that it was typically paying under $3 per dekatherm (Dth) in February, but these spot prices spiked on Feb. 12, and peaked at $231 Dth between Feb. 13 and 16. The highest spot prices Centerpoint had previously paid for in recent years was $67 Dth in December 2017.
The $500 million cost, it says, "represents approximately 156% of the company's total gas costs during the entire prior gas year," which ended June 30.
As a result, the company says it needs to recover some of these costs from its 879,000 Minnesota customers, at an average of $354 per customer, and that's before interest.
This would represent more than a 50% increase in an annual gas bill, which typically average out over the course of a year at $672, according to the Star Tribune.
To soften the blow for consumers, the company wants to spread recouping the costs over the course of two years starting in May, which would peak with an extra $30-a-month added to residential bills between May and November 2022, when gas usage tends to be lower, and $15-a-month for low income customers.
"The February market conditions were extraordinary, and as a result, so were the costs incurred," the filing says.
"We appreciate the Commission’s attention to this matter and believe that an approved recovery plan will help our customers understand and plan for the resulting impacts. This proposal is meant to smooth cost recovery over time so customers do not incur dramatic changes to their natural gas bill."