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Natural gas prices fall

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By John Friedlein

By JOHN FRIEDLEIN

jfriedlein@thenewsenterprise.com

HARDIN COUNTY — Local natural gas customers during these tough economic times might get a break on their bills like the one they are seeing at the pumps.

Elizabethtown Finance Director Steve Park — who, just this past summer, said he expected to see city customers’ heating bills spike a minimum of 15 to 20 percent over last winter’s — now is predicting a decrease.

He expects average January home heating bills to be $92.50 — compared to $105.80 for the same period last year.

“That’s at least one plus of the slow economy,” Park said.

It was good the city did not lock in prices during the summer, he said. Some New England towns that did so in July or August are paying double what they would have been had they waited, he said.

Local bills could be more that expected, though, depending on how cold the weather is. And natural gas prices are still fluctuating in a 5 percent range.

Factors that control prices include the cost of petroleum, the overall economy and weather factors — such as how hard the wind blows.

The National Weather Service’s long term forecast predicts a warmer than normal winter, which could translate into lower demand and prices.

LG&E, which provides service to some county residents, is expecting natural gas bills for the next three months to be higher than they were at the same time last year. Customers this year will see an average heating bill of $98 — up from $82 last year, spokesman Brian Phillips said.

Still, had high summer prices held, average bills would have averaged $37 more per month this winter, he said.

LG&E can hedge against cost increases by injecting gas into storage fields during the summer when prices are typically lower.

But this was no normal summer.

The natural gas prices hit a record in July and has since “fallen like a rock,” along with energy prices in general, Public Service Commission spokesman Andrew Melnykovych said.

LG&E passes fluctuations in the prices it pays to customers. High prices it paid this summer for gas put into storage will be passed to customers over time, Melnykovych said.

It’s a “complex situation,” he said. Natural gas reductions take longer to work through the market than gasoline price changes.

Both Elizabethtown and LG&E offer budget payment plans. For instance, LG&E looks at usage for the previous year and levels payments throughout the year, adjusting for actual usage. In this tough economy, a lot of people are interested in this plan, which takes the winter spikes out of the bills, Phillips said.

John Friedlein can be reached at (270) 505-1746.