By Nick Pedley
News Editor 

Gas prices top Hartley council agenda

Market driving up prices heading into heating season

 

September 16, 2021

A lengthy discussion about high gas prices lit a fire for the Hartley City Council on Monday.

Bill Lindley, president of the city's gas supplier, Clayton Energy, explained that market speculators and other extenuating circumstances are driving inflated prices. Natural gas costs still haven't returned to normal since February's bitter cold snap, which has him concerned the upcoming winter will be a pricey one.

"I'm very uncomfortable," Lindley said. "I don't like to be in this situation."

Natural gas prices surged in mid-February due to complications at gas wells in Texas, which froze up during the record-setting cold snap that immobilized much of the Midwest. As the nation's supply decreased, demand for heating fuel surged due to the frigid temps. Natural gas prices subsequently skyrocketed and utilities were left to foot the bill.

Hartley was forced to spot-buy natural gas during the cold snap to meet increased demand. Prices then were much higher than during "normal" periods, leading to a bill that was $152,000 greater than what the city had hedged for during that time frame.


Lindley discussed the city's daily use hedging program, which helps create a buffer for inflated gas prices during the peak heating season. Hartley currently has approximately 65 percent of its average usage hedged at a pre-established price, meaning 35 percent still needs to be purchased to get the city to 100 percent of its average usage.

Lindley is working on getting the additional amount pre-priced for the months of December, January and February – peak heating months that are subject to high fluctuations. If the additional gas is priced for those three months, then it will put Hartley in a position that better protects it from a situation like the one seen last winter.


Lindley wasn't optimistic prices would ease heading into fall. Exports and domestic demands for natural gas have kept prices elevated, with nothing on the horizon indicating things would change.

"We're still feeling this out a bit. Right now, nobody is comfortable buying," he said. "Speculators are controlling the markets and we're not in it right now."

Lindley said a warm winter would help reset the natural gas market and bring down prices. He typically considers prices ranging from $3.50-$3.75/MMBtu as good, but he said he would "jump all over" $5 gas this year.

"There are a lot of things going on in this industry that are frustrating being a user in this market," Lindley said. "It's not great news. The market is what it is, but it is good news that you've got 65 percent of your average purchased at decent prices."

In a unanimous vote, the council approved Clayton Energy's hedging program, acknowledging that prices may be high this year and encouraging Lindley to find the best rates he can.

• Pool update

Superintendent of Public Works Jaron Benz said construction of Hartley's new pool is progressing. Things were slowed a bit late last month due to heavy precipitation, but work resumed full speed this month after the ground dried out.

Concrete is the main focal point right now.

"They're making progress," Benz said.

Hartley Community Pool Campaign member Jackie Stoltz told Benz that many residents have asked her questions about progress, but she hasn't been able to provide solid answers due to a lack of updates. Benz said he can share the project manager's monthly report with pool committee members so they can disseminate the correct information with curious Hartley residents.

Stoltz also said residents have asked her if the pool was dug too deep. Benz noted that only a portion of the deep end was dug slightly deeper than what specs called for, but the issue has been fixed.

Engineer Wes Boyer explained that the affected area would have been backfilled and compacted to meet specifications and avoid future issues.

The pool is expected to open sometime next summer.

 
 

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