Natural Gas Prices Expected To Be Lower This Winter - The Missourian: Business

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Natural Gas Prices Expected To Be Lower This Winter

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Posted: Friday, November 22, 2013 5:00 am

Natural gas prices are lower this year compared to last, and there will be no change in Ameren Missouri’s electric rates.

Ameren Missouri natural gas prices dropped 3 percent this year, said Jim Massmann, director of gas supply for the utility.

The cost has been reduced from 67 cents per therm, or 100 cubic feet, to 65 cents for local customers. This could result in a savings of about $18 per year, which Massmann said is not a lot but is headed in the right direction.

“There is a sufficient supply to serve the demand,” said Massmann.

Laclede Gas Company, which includes Missouri Natural Gas, costs have also dropped from 54 cents per therm last year to 52 cents per therm for residential customers.

Ameren’s 65 cents per-therm cost covers the cost of the gas and the delivery of it to the Ameren system. That accounts for 60 percent of the cost on a customer’s bill and includes no mark up from Ameren.

The other 40 percent of a customer’s bill is to cover operating costs and investments in the system.

Laclede Gas Company spokeswoman Jenny Gobble said her company’s average customer will save $12 for the heating season, which runs from Nov. 1 to the end of March. The estimated savings does not take into account weather-related issues or a future rate adjustment.

“Natural gas remains the most cost effective energy source available for homes and businesses today,” Laclede Gas Company President Steve Lindsey said in a news release.

About 60 percent of a Missouri Natural Gas customer’s bill covers the cost of the gas. The other 40 percent is for the infrastructure and operating and maintenance costs to deliver the heating source to homes and businesses.

Ameren and Missouri Natural Gas offer tips on conserving energy. Tips from Ameren can be viewed at actonenergy.org and Missouri Natural Gas tips can be seen at http://www.lacledegas.com/efficiency/hottips.php.

Propane

Propane last week was about 20 cents higher per gallon compared to the same time period last year, said Russ Bales, manager of Heritage Propane in Washington.

He said local propane rates Monday were running at around $2.29 per gallon.

Last winter, rates were running between $1.99 to $2.09 per gallon, Bales added.

An average home with a furnace, water heater and gas logs could use 600 to 800 gallons of propane during the winter, he pointed out

The grain drying season in which corn is dried with propane heat is driving up the cost of propane because it is increasing the demand, Bales said.

There was not as much grain drying last year because the country was in a drought, he noted. But this year there has been much drying taking place in Missouri, Illinois and Indiana, he said.

It is difficult to say what will happen with propane prices once the grain drying season ends, which could be in a couple of weeks.

Problems in Syria have also caused rates to rise he said.

He said propane burns warmer than electric heat and is a very efficient fuel. He also said it is cheaper than using heating oil as a source.

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