Minnesota Senate doesn't act on direct relief for ratepayers after natural gas price spikes

ST. PAUL, Minn. (FOX 9) - The Senate has approved $15 million in zero-interest loans for Minnesota's municipal utilities to smooth over the price of natural gas price spikes, but the legislation does not offer any direct relief to ratepayers.

The bill passed unanimously and heads to the House. Senators from both parties appeared dissatisfied with the bill, with state Sen. Dave Senjem, R-Rochester, saying "There's a lot of story left on this one."

As late as Thursday morning, senators were discussing $100 million in relief for residential ratepayers, as a House bill does. But the measure that passed the Senate does not include any of that funding because of uncertainty whether Minnesota will be allowed to use federal stimulus money to aid ratepayers.

The price of natural gas spiked during a winter storm that hit Texas in mid-February. Minnesota regulators expect residential ratepayers will face increased bills of $300 to $600 this fall. Larger commercial customers are expecting bills in the tens of thousands of dollars.

Minnesota has 33 municipal utilities that serve 85 cities around the state and were forced to take on debt to buy natural gas in February. Under the Senate bill, they would be allowed to pay back the state loans over five years.

INFO: Gas bill increase may depend on utility vs city service

The Senate bill does not apply to the state's larger investor-owned utilities.