Nov 292004
Authors: Erin Skarda

Cold weather and rising natural gas costs on the national market will lead to increased heating bills this winter for Fort Collins residents and businesses.

Margarita Alarcon, a spokesperson for Xcel Energy, said residential customers can expect to see monthly bills increasing about 18 to 20 percent from the fall to winter months. Businesses may see an even larger increase of about 24 percent.

"When we enter into the heating season the temperatures drop significantly so usage goes up," Alarcon said. On average, customers use about 91 percent more natural gas in November than in October because of the drop in temperatures.

The typical residential bill for November will average about $94, up from the average of about $45 in October, Alarcon said. The prices will continue to increase in December with an expected average bill of $128.

Because of a fluctuation in natural gas prices nationally over the last three to four years, Xcel Energy has adopted a new way to inform customers about heating costs.

"What we have done in correlation with the Colorado Public Utilities Commission is move from annual cost adjustment to monthly cost adjustment," Alarcon said.

In the past, Xcel Energy adjusted its energy prices on a yearly basis every September, but the new monthly cost adjustment allows Xcel Energy to adjust its gas prices to more closely reflect national market rates. This then allows customers to anticipate increases in gas costs.

Melissa Marion, a spokesperson for the Natural Gas Supply Association, a company that represents U.S.-based natural gas suppliers, said the increases follow a trend that has been continuing for the last three years.

"It has been a tight market between supply and demand and natural gas prices are reacting to that," Marion said.

Many factors contributed to the rise in natural gas prices. Alarcon said high oil and gasoline costs are adding to natural gas price pressure as well. The severe hurricane season in the fall also affected the cost.

"The hurricanes on the Gulf Coast took out two different natural gas production plants," Alarcon said. "There is not as much being produced for the nation."

Although some natural gas is kept in storage units, Marion said lack of access to places where natural gas is produced, such as off-shore and in the Rocky Mountains, could contribute to the cost.

"A lot (of natural gas) is in storage, but it costs lots of money to take it out and put it back into the market," Marion said. "The wells being drilled are maturing faster so less gas is to be had."

Alarcon said since the cost of natural gas is so high, people should be careful how much energy they use this winter.

"We really stress conservation," Alarcon said. "Be smart about what you use."

Eric Moran, a sophomore computer science major, said he and his roommates keep their energy bills costs down by rarely using their heater and instead burning fires in their fireplace.

"When it's a really cold night (we will turn on the heat)," Moran said. "We will usually run it to get the house warm but then turn it off at night when we are sleeping."

Alarcon said students can do simple things to conserve energy, such as not over-drying clothes and sealing windows and doors well so the house is well insulated.

Moran said he would expect the heating bill for his house to be expensive because it is not well insulated.

"This place has such bad insulation if you heated it straight for a month, (the bill) would get very expensive," Moran said.

While Moran said he has not noticed an increase in his Xcel Energy bill yet, he said he and his roommates really have not used the heat too much.

"I don't want to spend money for heat," Moran said. "I can't afford it."



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