GEARY – The Geary City Council voted last Thursday to lock in the purchase price for one-quarter of its wintertime municipal gas needs this winter.
The city will pay $7.60 per MMBtu for about 25% of its gas from December to February. The decision comes months after devastating storms, especially in February 2021, sent energy prices skyrocketing across the state and region.
Mackenzie Haff, a retail marketing manager for Blue-Mark Energy, told the council to expect continued high prices for the foreseeable future.
“I just think we’ve gotten spoiled,” Haff said. “We’re coming off 10-year historical lows, right? We’ve all gotten used to the $2 pricing. That is not the market we are headed into this winter.”
Haff said she expects prices in the $8 to $9 range.
Councilman Cody Wright, though lamenting the high price, recommended locking in because of perceived uncertainty with the weather and the government. “Seven dollars, that’s kind of pricey right now,” Wright said. “Having said that, we could be going down the tubes.”
“There is no telling right now,” he said later.
Locking in pricing is a risk-reward proposition for the city, which is betting that prices will go higher than $7.78 per MMBtu for part of all of the winter. Having locked in only 25% of its purchases, the remaining 75% will be purchased at whatever the market rate happens to be at the time.
That will soften the blow to consumers if gas prices unexpectedly sit below that $7.78 number throughout the winter.
Haff said the city has saved about $25,000 off utility prices this year, and about $10,000 compared to its previous supplier, since switching to BlueMark.
“I guarantee this winter, come those months, we could be very happy. Very, very happy,” Wright said.