(FOX 9) - Minnesota Attorney General Keith Ellison is recommending the Public Utilities Commission block gas companies from charging consumers the increased gas costs they paid during February’s winter storm after an investigation found the companies could have reduced gas purchases during the price spike, but failed to do so.
Ellison is recommending the PUC disallow gas companies from charging $380 million to utility ratepayers in Minnesota, which represents nearly half of the approximately $800 million in higher costs utilities paid when the price of natural gas went up during Winter Storm Uri, according to a news release. The storm, which hit across the middle of the United States in mid-February, was responsible for increasing demand for natural gas and freezing natural gas wells.
Utilities typically recover their fuel costs directly from ratepayers, the AG’s office said. Following the storm, the PUC opened an investigation to review utilities’ actions during the pricing emergency.
The PUC requested comments from utilities and other stakeholders on the amount utilities should be allowed to recover as well as the mechanism for recovery.
The investigation uncovered and documented the following ways Minnesota’s natural gas utilities failed to reduce the cost of natural gas they purchased during the price spike, according to the AG’s office:
- Failing to reduce gas purchases by "interrupting" customers who have contractually agreed to a lower rate in exchange for the ability of the utility to require them to stop buying
- Failing to fully utilize "peaker" plants, which can reduce the need for natural gas for short periods with liquid natural gas and propane
- Failing to fully deploy natural gas held in storage to reduce the amount utilities needed to purchase during the price spike
- Failing to notify the public of the price spike so that homeowners and businesses could voluntarily reduce their consumption
- Failing to maintain a diverse mix of suppliers and pricing arrangements for natural gas that could have limited their dependence on high-cost sales.
The AG’s office has also asked that any amount the PUC does allow utilities to recover from the price spike be recovered over an extended period in order to keep bills low, and that the companies shield low-income customers from high bills.