Utility bills nearly doubled for La Plata, Archuleta and Montezuma residents in December, and San Juan Basin’s low natural gas storage levels will only cause rates to continue to increase in 2023.
According to Natural Gas Local’s website, Durango, Ignacio, Bayfield, Cortez and other towns in the San Juan Basin have all seen a 45.63% increase in natural gas rates during the last year, from $12.14 per thousand cubic feet in October 2021 to $17.68 per thousand cubic feet in October 2022.
Explained in a memo sent to Ignacio residents from town officials, there was an 89% increase in the San Juan Basin index price in December. One thing affecting San Juan Basin is low regional storage levels, according to a Southern Ute Utilities Division public service announcement. The SUUD blames the low storage levels on an increased natural gas demand in the Western United States, pipeline infrastructure limitations, and reduced flow from Canada to the Pacific Northwest.
SUUD also blames San Juan Basin’s low storage levels on national storage levels. According to the U.S. Energy Information Administration, the national storage levels have fallen an average of 5% below the five-year average heading into 2023’s winter season, and some areas along the east coast are experiencing double that.
U.S. Energy points to below-average natural gas inventories being caused by a record consumption of natural gas in the electric power sector in 2022. The strong demand for natural gas over the summer led to a reduction in net injections into U.S. working natural gas storage, U.S. Energy reported.
The El Paso San Juan Basin Index natural gas pricing in January is set at $32.97 per 1,000 cubic feet, which is up from $10.29 in December, an overall $220 increase. The SUUD recommends winterizing homes as a way to save on heating bills for the rest of the winter months.
Ignacio Town Mayor Clark Craig wrote in an email to The Durango Herald that many residents in Ignacio have a lot of frustration and concern about the drastic increase in their utility bills, and the town is working with SUUD on possible areas for rate adjustment.
“This will be a significant financial burden for all of our residents and surrounding neighbors,” Craig said. “And from what we hear, these prices are all across the southwest up to (Wyoming). This is not just an Ignacio area issue. We are just seeing it in real time.”