People who use natural gas to heat their homes should prepare for sticker shock this winter.
Black Hills Energy said it's expecting an average 58% increase this winter in the price it pays for natural gas. That forecast is based on an analysis of typical winter weather, market conditions and current natural gas price forecasts.
Customer bills could be higher or lower based on how much gas they actually use. The 58% estimate is based on the actual cost of natural gas, which Black Hills passes on to customers.
That's higher than the forecast last month from the U.S. Energy Information Administration, which predicted a 30% increase nationally and a 45% increase in the Midwest.
Most of that increase is because of higher prices for natural gas this year compared with last year, although experts also expect households to use slightly more natural gas this winter.
The forecast increase comes on top of a surcharge the more than 300,000 Nebraska customers of Black Hills already are paying because of February's extreme cold snap that sent natural gas prices soaring.
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Black Hills started levying the surcharge in July to recoup $86.5 million in additional costs related to the cold-weather event. The surcharge costs the average residential customer about $10 a month and is scheduled to last for three years.
People who signed up last year for Black Hills' annual price option, which allows customers to lock in the price of natural gas for the winter heating season, were exempt from the surcharge through the end of October, and the roughly 8,000 who signed up for the program this year will avoid paying the forecast higher natural gas prices.
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