Facing a record-setting gas bill, the City of Fulton will convene an emergency meeting with Fulton City Council members Tuesday night.
City council members will meet at 5:30 p.m. at Fulton City Hall (18 E. Fourth Street). Meetings are open to the public and will also be streamed online at fultonmo.org and the city's YouTube channel. Fulton Director of Administration Bill Johnson said the meeting will be primarily information; he doesn't expect any actions to be voted upon Tuesday.
Frigid temperatures throughout the United States have slowed the production and distribution of natural gas to a crawl, Johnson said.
"Multiple natural gas wells have frozen up - they're not able to pump it out of the ground," he said.
The combination of limited supply and increased demand has sent natural gas prices sky-high. The City of Fulton pre-buys 75 percent of its natural gas at a fixed rate. The remaining 25 percent goes to to the open market, and until now, Fulton had been paying $2.50-$4 per decatherm.
When trading closed Friday, the city learned they'd be paying $225 per decatherm. Fulton's currently purchasing an average of 3,071 units a day on the open market, Johnson said. That means the city's paying around $680,000 more per day than usual just to bring natural gas to residents and businesses.
Given the average Fulton household consumes just under one decatherm of natural gas per day in the winter, that works out to around $200 per household per day.
Markets remained closed over the weekend and remained closed for Presidents' Day, but will reopen Tuesday.
"I have my fingers crossed it'll show improvement, but with more gas wells freezing up, we're not optimistic," Johnson said.
When Johnson first announced the price spike Friday, he warned that much of the natural gas collected in the United States is converted into electricity. An increase in natural gas prices could also mean an increase in electricity prices, he said.
It seems those fears are being borne out, too. Johnson said Fulton pre-buys much of its electricity from several power plants. One of those plants, Prairie State Energy Campus in Illinois, had a unit go down Monday morning, reducing its power output and forcing Fulton to purchase electricity on the spot market at 12 times the normal rate.
"That's like $70,000 extra per day on the electricity side, but electric prices fluctuate by the hour," Johnson said Monday morning. "That's the price an hour ago, but it could go way down or way up."
According to the city, Fulton's natural gas customers won't see an immediate increase in utility bills.
"The city has reserves in its natural gas fund to cover unexpected costs," Public Information Officer Darin Wernig said Friday. "However, costs could eventually be passed on to consumers if prices remain high."
Johnson said there is about $5 million in the natural gas fund, and the city plans to withdraw up to $3.6 million "in a worst-case scenario." After that, they'll look at other available city money and - potentially - passing some of the the cost on to customers.
"There's no way we could pass all this on to customers, especially not all at once," Johnson said. "We may have to raise prices for natural gas by one or two dollars per decatherm to restore some reserves, but that will take years."
In the meantime, he encouraged Fulton residents to continuing conserving natural gas if possible. But, he said, the city doesn't want any residents to risk cold-related illness or injury, or frozen pipes.
"We don't want anybody to freeze up," he said.