
How to get a better deal on gas in Minnesota
- October 21, 2021
Minnesotans will have to pay an extra $3.75 per gallon for natural gas from the state’s gas distribution company in order to get to market this winter, a price hike that is being opposed by several small businesses and residents.
The increase was announced Monday, three weeks before the state expects to begin selling gas at full capacity in the first quarter of 2017.
Gas customers have until January 1 to switch to alternative fuels, including a fuel made by Entergy, which has a contract with the state to supply about 10 percent of the state population.
But the state Department of Public Utility Services says the increased gas prices will be applied to gas customers who pay for the service.
The agency also says the price increase is expected to cost taxpayers $300 million over the next five years.
“We’re going to have to increase prices and we’re going.
We’re going in the direction of more people having to pay,” said Scott Pritchard, president of the Minnesota Chamber of Commerce.
Pritchard said it’s hard to know exactly how much more gas customers will have when the state begins selling gas again next year, but the state has estimated the price hike could bring in an extra 1.5 million customers.
“The more people that we’re bringing in the more money we’re raising, and we can’t make that happen without increasing prices,” he said.
Minnesota Governor Mark Dayton said the increase was the result of “frustration” from customers.
The state has said it has to increase the price of gas because it doesn’t have the capacity to sell gas at the current rate.
It’s also struggling to comply with federal regulations, such as the Clean Air Act.
Prairie Fire, a nonprofit group that helps rural residents and businesses, says it has received complaints from Minnesota consumers about the price hikes and said it will soon contact the governor.
“There are still hundreds of thousands of people out there who aren’t going to be able to get gas until January because of the pipeline shortage and there’s no way to get them to a gas station and get gas,” said Tim Johnson, vice president of communications for Prairie Fire.
The Minnesota Public Service Commission, which sets rates for utilities in Minnesota, has said the gas distribution companies are required to sell at least 10 percent natural gas in order for them to receive federal subsidies.
The rate increase is part of a broader $1.4 billion increase the state is making to fund projects to restore power and improve transportation.
The new pipeline project also includes a new bridge, which will connect Duluth and Duluth-Sagan to a new natural gas pipeline.
The pipeline will be built to bring natural gas to a region where the natural gas supply is limited.