Rising cost of natural gas being passed on to HEC customers

Photo by Eric Gorton

By Eric Gorton, senior contributor

Customers of Harrisonburg Electric Commission can expect to see an increase in their monthly bills due to the rising cost of natural gas that is used to generate electricity.

Brian O’Dell, general manager of HEC, said the adjustment amounts to a 1-cent increase for each kilowatt hour billed. For customers who use 1,000 kilowatt hours per month, the increase would be $10, or about 10.5%.

“We recently had to pass along an increase in our fuel costs that we are billed from Dominion each month,” O’Dell said. HEC began billing with the new fuel adjustment cost on bills that were mailed Oct. 29. 

Such adjustments are normally made at the beginning of April each year, but the steep increase in natural gas prices necessitated the mid-year adjustment, O’Dell said. Not adjusting bills now would result in even higher costs next year “in an effort to play catch-up,” he said.

Natural gas now costs more than twice what it did in May, O’Dell said.

Bloomberg reported on Oct. 14 that “U.S. natural gas futures climbed after winter stockpiles of the furnace and power-plant fuel expanded less than expected, heightening concerns about adequate supplies going into the peak-demand season.”

“We have enjoyed low fuel costs for the past several years, again based on the low cost of natural gas. This FCA (fuel cost adjustment) is slightly lower than where we were in 2014, but higher than the previous seven years,” O’Dell said.

According to the federal Energy Information Administration, electric customers in Virginia paid an average retail rate of 9.16 cents per kilowatt hour in 2020 – cheaper than most other states. The national average cost per kilowatt hour in 2020 was 10.59 cents. Also according to the EIA, the average American home uses about 11,000 kilowatt hours of electricity per year.

The increase is hitting at a time when many customers normally see an increase in their bills, not due to higher costs to generate electricity or higher electricity rates, but because of higher electricity usage to keep warm. HEC’s winter rates for residential customers, for those using more than 800 kilowatt hours per month, is about 2.5 cents per kwh less than summer rates.

“This is in an effort to help our electric heat customers to manage their heating costs for the colder months,” O’Dell said.

O’Dell said customers can manage costs with some basic conservation practices.

“If you’re out of the house for long periods of time during the day, it makes sense to lower your thermostat setting by six or seven degrees in your absence,” he said.

The recommended setting in winter is 68 degrees while occupied, he said, adding that a blanket on the couch or an extra layer of clothing in the evening can help maintain comfort while keeping the thermostat down. He also recommends installing programmable thermostats that manage the temperature during times the house is vacant or when people are sleeping.

The city has a few options for HEC customers who need help paying utility bills, such as:

  • People Helping People – 540-433-7286
  • The Salvation Army – 540-434-4854
  • The Department of Social Services – 540-574-5100

HEC offers free home energy audits to assist customers in identifying ways to reduce energy use year-round. The audits include using infrared camera imaging to detect areas of heat loss around windows, doors and in attics, which accounts for the majority of wasted energy in most homes, second only to lack of insulation. More information about the audits is available on the HEC website.

The next adjustment for the fuel factor will occur in April 2022. Depending on a number of factors, including lower natural gas prices and a forecast for continued lower prices, it’s possible the HEC bills could be reduced then. 

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