Iowa Association of Municipal Utility (IAMU) member communities are preparing customers for the potential of unusually high natural gas bills when February invoices are released. Six towns in the listening area have city-owned gas utilities: Sac City, Wall Lake, Manilla, Manning, Coon Rapids and Guthrie Center. According to Wall Lake City Clerk, Chris Rodman, it is almost a certainty bills will be higher than usual, but it is not clear yet how much they will be increasing.
The concern lies with how the remaining natural gas demand is met, usually through what is known as the spot market. At the beginning of the month, natural gas was going for about $3 per 1,000 cubic feet (Mcf) but jumped to as much as $150 per Mcf due to high usage and freezing pipelines in the southern United States. For example, with Harlan Municipal Utilities, which is within IAMU Region 2, natural gas expenses spiked to $1.8 million between Feb. 11 and 17 compared to only $70,000 the prior week. It is not feasible for municipally owned companies to eat these costs and they get passed on to customers. Rodman says their city council and more than 50 other municipal gas utilities are still trying to determine what that may look like.