Energy costs expected to be lower

Published 12:00 am Thursday, October 19, 2006

NATCHEZ &8212; Falling prices in the global natural gas market means Entergy consumers will continue to see their bills go down in the next three months.

Stephen Caruthers, Entergy Mississippi spokesman, said the 18 percent reduction expected through December continues a trend downward that has seen bills fall by more than 30 percent since March.

And at Atmos Energy, prices have dropped for natural gas customers by more than 50 percent since last October.

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&8220;Prices peaked last year at the highest ever in October,&8221; said Robert Lesley, director of public affairs for Atmos Energy&8217;s Mississippi division.

&8220;Last year, Hurricanes Katrina and Rita did so much damage to the refinery infrastructure that we couldn&8217;t get the gas out of the ground,&8221; Lesley said. &8220;Now the refineries are repaired, and we didn&8217;t have a big hurricane in the gulf this summer. Our storage levels are very high.&8221;

For Mike Anderson, chief financial officer at Natchez Regional Medical Center, the news is very good indeed.

&8220;Utilities are my third highest expenditure, and last year it went through the ceiling,&8221; Anderson said. &8220;Over the last three years, the cost overall of utilities rose by $250,000 &8212; a 20 percent increase over three years.&8221;

At the Natchez Convention Center, Walter Tipton, tourism director for the City of Natchez, also welcomes the break in utility bills.

The four buildings Tipton oversees &8212; Natchez Convention Center, Natchez Visitor Reception Center, City Auditorium and Community Center &8212; take a big bite out of his monthly budget.

The Entergy electric bills total about $13,700 a month; the Atmos gas bills, about $12,000 to $15,000 annually.

Tipton said conservation practices help to keep the costs down, but consumption of electricity is huge, especially at the visitor center, where one big unit heats and cools.

&8220;At the convention center, we have 16 separate units. Everything is zoned. The exhibit hall is completely shut down when it is not being used,&8221; Tipton said.

&8220;At the visitor center, the one big unit carries the whole building, but we&8217;re trying to smart about conserving,&8221; he said. &8220;We&8217;ve seen some real spikes in utilities in the last two years or so.&8221;

Even with utility costs going down now, &8220;we&8217;re still above where we were three years ago,&8221; Tipton said.

Natchez businessman Scott Kimbrell said utilities are a big item for him, as his business is located in a 10,000-square-foot downtown business with high ceilings.

The continuing drop in electric and gas bills will be helpful, Kimbrell said. &8220;Utilities are my third biggest costs after salaries and insurance,&8221; he said. &8220;Any expense we can cut will be helpful.&8221;

In his family-owned business, attention to conservation of energy is a high priority. &8220;But you have to have electricity and gas. It&8217;s an expense we don&8217;t have any control over.&8221;

Caruthers said conservation of energy continues to grow in importance. &8220;In the economy and society we live in today, I think everyone is becoming more conscientious about their use of gas and electricity as well as gasoline,&8221; he said.

Andrew Calvit, manager of the Natchez Atmos office, agreed. &8220;Even with prices going down, I strongly encourage customers to conserve because energy prices may be falling but you never know what kind of winter we may have.&8221;

Lesley, with the Atmos Mississippi division, agreed. &8220;Supplies look good for the upcoming winter.&8221;

The utility companies adjust their customers&8217; bills according to what is called the fuel adjustment. &8220;The customer&8217;s rate is the same,&8221; Caruthers said. &8220;It&8217;s the fuel adjustment that has changed. For the bigger users, a larger portion of their bill is fuel adjustment. They&8217;ll be happy to see the change in their bills in the next three months.&8221;

At Natchez Regional, Anderson has begun interviewing energy-conservation consultants.

That move grew from watching energy costs escalate. &8220;We&8217;re sitting here saying, &8216;that&8217;s something we can do something about,&8217;&8221; Anderson said. Conservation measures might include upgrading air-heat-ventilation systems and installing energy-conserving windows, for example.

&8220;The consultants will do the plan of action and our people will implement it,&8221; he said.

What about the supply of energy in the future? What measures are Entergy and Atmos, for example, taking to address what is expected to be a growing need for energy?

At Entergy Mississippi, more than half the electricity is generated by natural gas, Caruthers said. He looks forward to the day when a second nuclear facility may be located at Grand Gulf, an Entergy facility.

&8220;I wish we had another nuclear plant on line and paid for right now,&8221; he said. &8220;Nuclear energy gives us a stable way to produce energy.&8221;

Entergy is interested in a second facility at the Grand Gulf Nuclear Station near Port Gibson and has taken some initial steps in that direction.

&8220;But it is a huge expense and it takes a lot of time,&8221; Caruthers said.

Lesley said, &8220;At Atmos Energy, we believe that the most pressing natural gas issue for the future is ensuring that there is enough supply to both meet demand and keep costs manageable.&8221;

Because production is in an upward trend for natural gas, its price is falling, he said.

&8220;For the long term, Atmos Energy believes that government should take action to encourage increasing gas supply,&8221; Lesley said.