An unwelcome, expensive and possibly illegal surprise was the topic of discussion at an emergency city meeting Thursday night in New Haven. The Board of Aldermen and other city officials met to discuss a quadruple increase in the price of the city’s natural gas in February compared to January. The towns of New Haven, Hermann and Berger, which together comprise the Municipal Gas Commission of East Central Missouri, must pay close to $1.6 million total for the bill, and New Haven Ward 1 alderman Tim Otten said the bill will be paid whether the money is there or not.
“(New Haven) estimates a bill of around $810,000. To give you an idea, normally we’d expect a bill around $200,000,” Otten said. “We barely have $800,000 in all our natural gas accounts (including) maintenance and reserves. So what our gas supplier is going to do, and it’s an automatic draft — we do not have a choice — is they’re gong to take $810,000 out of our bank account and completely drain us (and) leave us no money to make payroll or keep the system going.”
The city will pay $75,000 and ask its gas-burning customers, about half of its 900-plus households, to pay the rest. When customers get their February bill, they will have to pay their January bill amount and then will have one year to pay the remaining total on their February bill in installments.
“Ultimately, we have to bill our customers,” Otten said. “It’s going to hit families, people on fixed income. My wife’s fitness center and my house use gas. Normally our bill is $350, and we’re probably looking at a $1,350 bill for February. It’s going to hurt everybody hard.”
While the increase from January to February 2021 is stark, Otten pointed out the price increased 2,188 percent from February 2020 to February 2021.
Otten also brought up industrial gas users, namely Henniges, which will see their already five-figure bills increase to six figures.
“This is something they’ll have to take out of their bottom line,” he said. “I could understand (the prices) going up 50 percent or even doubling. But going up four times? That, to me, is the definition of price gouging.”
The city’s natural gas supplier is Kansas-based Utility Gas Management.
After deciding how to pay the bill, Otten said the city’s second most pressing question is how to ensure a similar situation never happens again.
New Haven officials and others across the state are pressing Gov. Mike Parson to declare a state of emergency. Otten said this would do two things: It would allow Missouri towns seeing these upcharges to apply for federal aid, and it would encourage State Attorney General Eric Schmitt to investigate price gouging.
The governors of Kansas and Illinois issued disaster proclamations in the last two weeks, and a letter signed by Sen. Roy Blunt, Sen. Josh Hawley, Rep. Blaine Luetkemeyer and others and sent to the Federal Energy Regulatory Commission urged the commission to investigate the weather-related energy demand spikes, calling it a “crisis.” Minnesota Sen. Tina Smith told the Associated Press that natural gas prices across the Midwest spiked as high as 100 times normal levels in February.
In addition to New Haven, Hermann and Berger, several Missouri towns, including Fulton, Macon and New Florence, along the Panhandle Eastern Pipeline and other pipelines are facing similar increased bills.
Otten said he hopes the affected areas will all join in on one action with the state.
“The problem is most of these are small communities out in the country, and they don’t have access to the right people,” Otten said. “So we have to get the right people involved and get them to take care of what the traders have done.”
New Haven customers who have been impacted by February's rise in prices can file a complaint with the state commissioner at https://ago.mo.gov/app/Complaints/Consumer.