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Price of natural gas likely to increase by 30 to 50 percent for local homeowners starting next month
By RYAN FIRKEL
Era Reporter
The price of natural gas is likely to increase by 30 to 50 percent for local homeowners starting next month, soaring beyond a projected 2.2 percent increase released by National Fuel Gas Co., in early January.
Nearing the release of National Fuel’s quarterly report at the end of the month, National Fuel Senior Manager of Corporate Communications Nancy Taylor said Wednesday that due to market turmoil the price of natural gas is anticipated to significantly increase in cost between 30 and 50 percent.
“Our forecast was significantly wrong,” said Taylor. “The commodities market has changed dramatically since January. Given the state of the gasoline and oil markets, when one goes up they all go.”
Taylor said the quarterly release will set the price homeowners will pay for natural gas through the fall and some winter months.
The change in price will look very different in the upcoming months, with unofficial figures raising the cost of 1,000 cubic feet of natural gas from $7 to $11. A typical residential customer using natural gas this year would spend an extra $26 a month. The projected increase of 2.2 percent would have raised the average monthly price by $2.75, according to Taylor.
“Whatever price we pay for the commodity we are required to pass it directly along to our customers,” said Taylor. “Globally, energy is in such high demand the changes in the markets we see reflected in gasoline prices carries over.”
Locally, residents are paying more than $4 a gallon at the pump and the price for oil hovers around $120 a barrel. The region has also seen an dramatic increase in the number of oil and natural gas wells being drilled — particularly following the discovery of the Marcellus Shale deposit. Currently, the cost of natural gas is around $11.15.
Taylor said as a precautionary move against the climbing cost of natural gas, National Fuel waived purchase gas cost in May.
“It was startling to see the upward vitality between May and now, with June exceeding all other prices,” said Taylor. “We do not want to give any definite figures at this time because we generally take until the last minute to use the most recent research materials to set our prices.”
National Fuel will have another opportunity to change its price for natural gas in November, at the next quarterly report. Nearing the fall and winter months, National Fuel allows many different plans and discounts for people who have difficulty or will have difficulty making monthly payments.
A low income residential assistance program is available for customers of National Fuel who live 150 percent below the national poverty level. Based on past payment troubles, household income and the number of people at the residence as variables, discounts can range from 10 to 70 percent.
Payment plans, called budget plans, are also available and highly recommended by National Fuel. A budget plan would allow a steady monthly payment for natural gas spanning over the 12 months.
“Most of us are on a fixed income. For budgeting purposes it is a good plan for our customers to be involved in — rather than paying higher winter bills,” said Taylor. “People recognize that with gasoline and oil prices ... think about it logically rather than emotionally. Natural gas is right there in the mix with gasoline and oil. It is good to get people thinking of this early so they can plan around the higher costs.”
National Fuel serves about 214,000 customers in 14 counties in northwestern Pennsylvania, including McKean County.
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