As natural gas prices continue to drop nationally, Minneapolis, MN-based Xcel Energy last week proposed to Colorado state regulators a 21% decrease in February 2006 natural gas commodity prices. Combined with a decrease in expected use, the utility said bills would decrease next month by 31% for typical residential customers and by 35% for typical small-business customers. If approved, the new prices would take effect Feb. 1.
The natural gas commodity price proposed to the Colorado Public Utilities Commission for residential and small-business customers would decrease to $0.8180/therm in February from $1.0321/therm in January. The new price reflects anticipated natural gas costs only for the month of February.
Xcel Energy said typical residential customers are expected to decrease consumption by 18% in February compared to January, so their overall natural gas bills would decrease to $125.83, based on consumption of 119.9 therms. This compares to $183.34 this month on use of 146.6 therms.
Typical small-business customers are expected to use 22% less natural gas in February compared to January. Typical natural gas bills would then be $569.31, based on consumption of 569.9 therms, compared to bills this month of $881.34 on use of 730.1 therms.
"Projected natural gas prices for February 2006 are lower than the forecast used for January 2006, yet natural gas prices remain at historically high levels due to a continued tight balance between supply and demand," Xcel Energy said. "The lingering effects of Hurricanes Katrina and Rita also continue to impact natural gas production in the Gulf of Mexico."
However, the utility pointed out that since mid-December 2005, the weather has taken a decidedly warmer turn, reducing natural gas loads and forcing a decline in natural gas futures prices. According to NGI, February natural gas has plummeted from a high of $15.780 on Dec. 13, 2005 to an intraday low of $8.505 on Jan. 18, marking a $7.275 swing in a little over a month.
In February 2005, Xcel Energy's typical residential customer bills were $98.22, or $27.61 lower than projected for next month, based on the same consumption of 119.9 therms. Typical small-business customer bills were $438.15 in February 2005, or $131.16 lower than projected for next month, also based on the same use of 569.9 therms.
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