February 19, 2021

Midwest Energy Addresses Bill Impacts of Energy Emergency

Extreme Arctic temperatures in Midwest Energy’s service area Feb. 10-17 caused exceptionally high demands on the co-op’s electric and natural gas systems.  The Southwest Power Pool (SPP) declared an Electric Emergency on Feb. 14, and Midwest Energy put out pleas for energy conservation, which its members followed to protect the grid.  With the emergency over, concern among customers has shifted to impacts to the bills they’ll receive in March. 

The combination of lower supply and higher demand resulted in record high electric and natural gas prices. Gas that sold for $2.50 a dekatherm early in the month spiked to more than $600 a dekatherm by mid-month. 

“We will not know the total cost increase until we receive gas supplier bills in early March.  Next month’s gas bills will show little of the price runup, but will show the impact of increased gas use,” said Bob Muirhead, Midwest Energy’s Vice President for Customer Service.  “The higher market prices for gas will flow through bills in later months, and we are looking at spreading those costs over several months, to avoid a one-time shock. ”

Regarding electric bills, Muirhead said that Midwest Energy is part of the Southwest Power Pool (SPP) which covers parts of 14 states.  This interconnected network improves electric reliability and achieves lower prices.  The SPP also operates the regional energy market, which saw spot prices for electricity spike during the emergency.  Muirhead said that’s because considerable amount of electricity in SPP is generated using natural gas for fuel, and it became very expensive to generate electricity using gas during that period. 

“As with gas, we will not know the full amount until end of month,” Muirhead said.  We do expect the impact on electric bills will be less than gas bills, but we’re uncertain as to the degree of the impacts.”

Muirhead said one thing customers can do is enroll in Midwest’s Budget Billing program.  With budget billing, Midwest creates an average payment based on your previous 12 months of bills.  That average is then set as your bill for the next 12 months, when it would re-set again.

To be eligible, customers should have had service for at least one year, and the account must be current on payments with no overdue balance.  Muirhead recommends calling in as soon as possible to set up budget billing.  “The sooner a customer gets on the budget billing program, the better they can get that payment averaged out.”

Muirhead concluded by saying Midwest will be working closely with customers to ensure they can continue paying bills.  “If a customer has a balance on their account, we will work with them to make payment arrangements for them to make it easier to pay,” he said.  “This was an extraordinary event, and we’ll be doing whatever we can to help our customers out.”    

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