Natural gas prices leveling off

By Mike Dennison - 09/04/2008

HELENA — While natural-gas prices in Montana have declined somewhat from record highs this summer, demand for home-heating assistance still is expected to go up this winter, utility and human-service officials told state utility regulators Wednesday.

"I wouldn't be surprised if (our spending) went up 25 percent over last year," said Gregg Groepper of Energy Share of Montana, which helps financially strapped households pay winter heating bills.

Officials with NorthWestern Energy, the state's largest natural gas and electric utility, said they'll step up promotion of conservation programs available for customers.

On Wednesday, the company launched an expanded rebate program for energy-saving steps aimed at natural gas customers. For example, homeowners who insulate their attic or walls can get rebates of up to 62 cents per square foot on insulation.

"Increasing insulation levels or using a programmable thermostat are proven ways for many customers to reduce home-heating usage levels," said Bill Thomas, manager of regulatory support services for NorthWestern.

Thomas, Groepper and others spoke Wednesday before the state Public Service Commission, which regulates utilities. Its members have been sounding the alarm about potential record-high heating costs this winter.

NorthWestern has about 180,000 natural gas customers in Montana.

In June, Northwestern customers were paying about $15 per dekatherm for gas — about 50 percent higher than prices a year ago and the highest price in recent memory for delivered natural gas.

But this month, the price has fallen to about $12.20 per dekatherm, company officials said Wednesday. An average household using natural gas consumes about 120 dekatherms a year, and winter usage can be 15 to 20 dekatherms per month.

Gas customers of Montana-Dakota Utilities in Billings and eastern Montana and Energy West in Great Falls and West Yellowstone have seen similar declines in price since June.

NorthWestern said Wednesday while prices have leveled off and even declined, it can't be sure what will happen this winter. Higher demand and higher world prices for gas could send prices bouncing back up, or a mild winter and less demand might mean lower or stable prices, they said.

Jim Nolan, director of the state's Low Income Energy Assistance Program (LIEAP), said he expects a 5 percent increase in program demand. The program serves about 19,000 households with heating assistance and weatherization.