The recent spell of icy, cold weather and a five-year low in natural gas supplies should push heating bills higher this month, although rates are slipping back down heading into March, said Phil Hardwick of Mississippi Valley Gas Co.
"They went sky high on Tuesday, and they're dropping like a rock today," said the company's vice president for economic development and community relations.
Tuesday's price was about $10 per 1,000 cubic feet. Today's rate is $7.48.
He attributed the volatility in the gas rates mainly to the weather. This winter has brought temperatures 16 percent colder than last winter's, according to Hardwick.
In response, residents are using more gas to heat their homes, and higher consumption creates higher rates. As the weather has warmed up later in the week, the rate has fallen, Hardwick said.
Also, storage levels of natural gas are down nationwide. According to the U.S. Department of Energy, supplies are 43 percent lower than this time last year and 27 percent down from the five-year average.
Hardwick said Mississippi Valley Gas maintains back-up supplies, which are mitigating the impact the shortage in the overall market might have on its customers. The company usually buys that gas in the summer, when prices are lower, he said.
"The primary purpose for that is for supply on really cold days, like when it gets down to single digits. However, we will withdraw some of that gas when prices go up."
Not all customers will see a big change in their bills, Hardwick said. Mississippi Valley Gas doesn't read every gas meter in town every day. They are read on 18-day cycles, and during periods of fluctuating prices, some meters might hit a high rate one day and some might not.
"It's very possible that one person on one side of town could get a bill higher on a per-ccf basis than someone on the other side of town," said Hardwick. "That happens depending on when the meter is read."
