Bill passed to aid consumers from natural gas price spikes
The Minnesota Senate passed Senate File 1018 last Thursday. This bipartisan legislation establishes the 2021 Polar Vortex Loan Account for municipal utilities that purchased natural gas during the extreme weather that occurred this February. The bill provides $15 million from the general fund for zero-interest loans that need to be repaid within five years.
"Many Minnesotans now face the prospect of having to pay as much as 10 times more for their next natural gas bill," said Senator Gary Dahms (R-Redwood Falls). "This bill provides needed relief for municipal utilities and Minnesota families. We need to get out economy back moving again and most Minnesotans cannot afford to pay for these massive price spikes."
Due to a variety of factors stemming from the polar vortex that occurred in February, the price of natural gas has had an unprecedented price surge throughout much of the nation. In Minnesota, natural gas utilities were hit hard by the price surge while also coinciding with a cold snap, meaning consumers were using more and paying a higher rate for natural gas.
During one five-day stretch, some utilities spent their entire gas purchasing budget for the year. The residential impact range is estimated from $250-$500 for a typical residence for those five days alone. One business owner testified that they typically spend $12,500 a month on gas and now could be facing a bill of $125,000.
The Polar Vortex Loan Account would grant municipal utilities the option to help pay their bills now and to spread consumer payments out over the five-year repayment term and could greatly reduce the impact on both the utility and the consumers.