Questions, concerns about skyrocketed natural gas prices continue

Published: Feb. 22, 2021 at 5:33 PM CST
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WICHITA, Kan. (KWCH) - A push for answers continues when it comes to skyrocketed costs for natural gas and how much of the burden will be passed on to residents and businesses. To recap, natural gas was selling for about $3 per unit, then at the peak of the coldest temperatures Kansas has seen in decades, that price jumped to several hundred dollars per unit. Cities across the state now face gas bills in the millions of dollars. Individual customers are looking at bills that could stretch into the thousands and everyone involved wants answers.

As the state finally thaws out, administrators in some Kansas city’s say they have no idea how they’ll pay their gas bills following an historic cold stretch and historically high natural gas prices.

“We have just so much time to pay and then we need the cities to help us pay,” said Sam Mills with the Kansas Municipal Energy Agency (KMEA), a nonprofit that buys and sells natural gas to about 40 cities across the state.

When the price of the natural gas began to skyrocket, the agency began calling cities and warning them of what was to come. Those cities began warning residents and businesses.

“That for us, mean a few things. We turned down all the thermostats, we shut down all the operations,” said Seth Beytien, operations director at AGCO in Hesston.

There were also layoffs.

“It’s not something that we want to do, but it’s something that we have to do to protect the business for the long run,” he said.

Mills said the KMEA is pushing for state and federal investigations to determine if the extreme weather event is the lone cause for the skyrocketed price.

“We would like to think there was nothing sinister involved in it, but we want to know if there was. And that’s why we’re asking about these investigations,” Mills said.

For residential customers who use Black Hills Energy or Kansas Gas Service, there are regulatory agencies looking at how the high costs will be passed onto customers. For cities that use KMEA, who might step into help isn’t clear and neither is how much help might be needed.

“But the reality is, I think there needs to be some action to dig in and understand specifically what happened and what can be done to A. hold some folks accountable, if that’s possible and necessary and B. see what we can do in the future to make sure that we avoid situations like this going forward,” Beytien said.

So, how did this happen when we all knew it would be well below freezing for several days. For KMEA busy gas three ways to deliver the cheapest prices to customers. Some of that gas is purchased daily, and we now know that daily prices skyrocketed last week. So, the next question is, who’s getting all of this money?

Even those buying gas off the pipeline at the high prices say they don’t know. Others are turning to lawmakers to get them answers and urge everyone affected by these prices to do the same.

Kanas Governor Laura Kelly is urging the Federal Energy Regulatory Commission to investigate systematic failures during this month’s weather emergency, and to protect Kansans from demand-related price surges for natural gas and electricity.

Kansas was among many states hit hard with snow, ice and bitter cold over the past two weeks. Kelly and the Kansas Corporation Commission called on the federal government to examine the circumstances that led to reduced supply of natural gas. Kelly will seek aid from the Biden Administration and will encourage Congress to pass a stimulus package to provide relief for Kansas customers.

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