TOPEKA – The Kansas Corporation Commission (KCC) is warning consumers that energy prices are expected to remain high for the foreseeable future based on current national forecasts. This will likely increase the cost of cooling homes and businesses this summer and heating them this winter. Now is the time to take steps to weatherproof your home and make energy efficiency investments where you can.
Like many other energy and commodity prices, monthly wholesale natural gas prices have recently increased to levels not seen in the United States since September 2008. Wholesale electricity prices have also increased . On April 18, the New York Mercantile Exchange (NYMEX) futures price for natural gas climbed to nearly $8/MMBtu (Metric Million British thermal units) for May and June, with prices above $8/MMBtu for the rest of the year and next winter. . For context, natural gas prices have consistently traded in the $2-$3/MMBtu range for much of the past decade.
Wholesale natural gas prices are based on supply and demand and are unregulated, a decision made by the US Congress in the 1980s. As a result, these costs are often beyond the direct control of energy providers and are passed on to the end consumer outside of a tariff file without any increase or profit. Importantly, pass-through energy costs are audited by KCC audit staff to ensure that customers only pay the actual wholesale energy costs paid by their utility provider, again without mark-up or profit. .
The Energy Information Administration (EIA) recently released its short-term energy outlook stating that energy price forecasts for the remainder of the year are subject to heightened levels of uncertainty due to factors such as the the continued war between Russia and Ukraine, OPEC+ decisions, and the rate at which U.S. oil and natural gas producers are increasing drilling in response to higher prices.
The Commission has launched an online resource to provide additional information, help consumers minimize the impact and find financial assistance and help with weather protection. Information is available at https://kcc.ks.gov/consumer-alert-spring-2022