Legislation signed to assist public gas utilities

Nebraska Governor Pete Ricketts signed into law a bill (LB 131) that includes an amendment providing $4 million for a grant program to assist municipalities that own and operate their own natural gas systems in addressing extraordinary costs due to February’s extreme weather event. The bill advanced through the Legislature in May.

Under the Municipal Natural Gas System Emergency Assistance Act, municipalities may apply to the State Treasurer’s Office for a grant to cover up to 80 percent of the extraordinary costs incurred by the municipality as a result of the extreme weather event, which caused natural gas market prices to skyrocket during extreme cold that covered the entire Central U.S. for several days.

The amendment to LB 131 was developed in the Urban Affairs Committee, chaired by Sen. Justin Wayne, after a hearing on February’s weather event and the impact on municipal gas utilities. The National Public Gas Association (NPGA) was among several Nebraska gas suppliers that provided testimony at the hearing. Several NPGA members were impacted by the event, which caused the usage of impacted members to more than double, forcing natural gas purchases to be made on the intraday market, where prices were astronomically higher.

NPGA, which schedules monthly natural gas deliveries for its members, had 100 percent of anticipated gas needs for February monthly usage purchased prior to Feb. 1 for its members. The severe cold and length of the extreme weather event led to significantly more usage than those anticipated gas volumes.