Huval says the bill increases are also attributable to record months of heat in July, August and September ' a problem exacerbated by low levels of rainfall. "Rob Perillo told me those three months in 2005 are the hottest on record ' that means the hottest in 112 years," says Huval.
With natural gas prices falling to about $10 per thousand cubic feet in November, down from a yearly high of $14.68 at one point in October, utility customers should get some relief.
Lower bills should be arriving in LUS customers' mailboxes any day now, Huval says. "With the first two of our four new generating units now in service, we are in a position to reduce our fuel costs to our customers significantly." He adds that the fuel component is dropping from 6.4 cents to 5.4 cents per kilowatt-hour. The new units are more fuel efficient, and new technology allows them to be turned off within minutes when usage is down, so LUS will be able to increase its coal utilization to 70 percent. "What that means is that with these new units, we are now relying on natural gas for only 30 percent of our total generation needs," he says.
LUS' effort follows a national trend by utility companies to wean themselves from natural gas-fired generation.
However, other customers in the state, served by utility systems more dependent on natural gas, were hit much harder in recent months. Consumer outcry led the Louisiana Public Service Commission to order audits of Cleco's and Entergy's gas purchases through October of this year in an effort to determine if they bought gas at the cheapest available rates. "In October 2005, Entergy and Cleco's residential electric charges were about 23 percent and 18 percent higher than LUS' respectively," Huval says.
Manuel Lam, an energy analyst with the Louisiana Department of Natural Resources, says about 37 percent of the Gulf of Mexico's natural gas production is still shut in but should be back on line soon. With natural gas storage climbing and November weather unusually warm, he expects prices for the rest of the year to settle in the $10 to $11 range.
But, says Lam, it's still anybody's guess what kind of weather awaits in the winter months ahead.
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