The recent cold snap and energy crisis in Texas will soon be hitting close to home for customers of Roanoke Gas Co.
Price increases in natural gas due to the historic weather event will lead to an approximately 68% increase in bills that will likely continue through the year, the company announced Tuesday.
For an average residential customer, that works out an extra $15 to $25 in the March bills that will be arriving soon.
“We have worked diligently to moderate the impact to our customers,” Roanoke Gas President and CEO Paul Nester said. “However, it may take up to two years for these costs to be fully recovered.”
Gas for the company’s nearly 63,000 customers in the Roanoke and surrounding regions is purchased at wholesale rates, the company noted, and any increase is passed along to customers without any markup.
During an eight-day period starting Feb. 13, Roanoke Gas spent about $3 million for the gas it receives from the East Tennessee and Columbia pipelines. Purchases for the entire 2020 fiscal year were just below $15 million.
To recover the higher costs, the company is seeking permission from the State Corporation Commission to raise its current cost of gas from $2.31 to $3.89 per dekatherm. The SCC is expected to rule shortly.
In general, the higher prices will be felt most by industries and other businesses that use more gas.
Both the East Tennessee and Columbia pipelines deliver gas from the Gulf Coast, which has been most affected by the crisis. In the future, Roanoke Gas plans to draw from a third source, the Mountain Valley Pipeline, that will transport gas from the Appalachian Basin is that is currently not as expensive, Nester said in a news release Tuesday.
“This is a real-time, real-world example of the need for the Mountain Valley Pipeline and the gas it will supply our customers and others throughout the United States,” he said.
During the worst part of the crisis, over Valentine’s Day weekend, the company spent more than $21 per dekatherm. The pricing point for Mountain Valley gas was in the $4 per dekatherm range during the same period.
“As these numbers indicate, the flexibility and supply diversity that MVP would have provided are material,” Nester said.