By Cassie McClure and Suzanne Michaels
Published in the Las Cruces Sun-News 2/23/20
Due to technology advances Las Cruces Utilities (LCU) has seen a steady reduction in the cost of gas that it passes on directly to utility customers. It’s up to Mario Puentes, LCU gas business analyst, to monitor and adjust the quantity of natural gas available to utility customers to make sure their needs are met, while making sure the price is based on LCU Gas Supply Agreement(s). That means he keeps an eye not only on the market, but also on the weather.
“The first thing we consider is the historical volumetric data for any particular month as gas is initially ordered on a monthly basis. Then, as each month rolls out the focus turns to the weather and the quantity being consumed daily by the residential and business customers,” said Puentes. “Then it’s a matter of adjusting the supply to reflect our customer’s gas use patterns and quantities. During the winter, the weather is the number one factor affecting consumption.” For example, the gas consumed on February 11th, a snowy day, was more than twice than on February 9th.
As Las Cruces has seen a shift from mild weather to warmer temperatures and back to cold snaps, Puentes adjusts the amount of gas the City buys from its suppliers. The natural gas used in Las Cruces primarily comes from the Permian Basin - one of the biggest producing basins in the United States – located in eastern New Mexico and west Texas.
But, to ensure all our eggs are not in one basket, LCU has other reliable sources of natural gas. Such as the 30-year agreement LCU signed in 2018 with the Public Energy Authority of Kentucky (PEAK). The long-term contract provides a discount from market prices of 20-cents per decatherm. This agreement provides approximately 20% of the natural gas for LCU customers for three decades at a discounted rate – saving an estimated $3.9 million over 30 years.
Natural gas prices go up and down. Especially during the 2007-2008 years gas was costly. Currently, due to increased production, gas is a reliable and cost-effective source of energy. The five-month heating season stretches from November through March. During that time, the average Las Cruces household uses about 50 decatherms of natural gas. To compare prices, Puentes explains, “In July 2008, natural gas cost $12.24 per decatherm, or around $122 per average household. As of February 1, 2020, we paid only $1.25 per decatherm, with an average customer cost of only $13 for the month.”
Puentes is referring to the cost of the gas only. To get it to homes and businesses, a customer’s bill will also include the cost of delivering the gas to the customer’s meter. For example, the residential monthly access charge is currently $13.75, plus a per decatherm delivery charge of $1.34.
You can reach Las Cruces Utilities at 528-3500 from 8 a.m. - 5 p.m. Monday through Friday. Las Cruces Utilities provides GAS – WATER – WASTEWATER – SOLID WASTE services to approximately 100,000 Las Cruces residents and businesses.
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PHOTO 1: High pressure pipeline bringing natural gas to Las Cruces.