Mt. Vernon Register-News

April 16, 2014

MVTHS eyes high gas bill

The Register-News

---- — MT. VERNON — An unusually high natural gas bill sparked a great deal of concern at Monday afternoon’s meeting of the Mt. Vernon Township High School Finance Committee.

The bill in question, for roughly $29,000, was for the month of February 2014. It comes from the district’s new gas provider, Constellation.

By comparison, the February 2013 gas bill for MVTHS was only $8,225.

Committee members said Monday they want to investigate the new bill further before authorizing its payment. The issue is set to be discussed again at next Monday’s meeting of the MVTHS Board of Education.

“Until I understand it, I don’t think we should be paying that,” said MVTHS Board member Bill Beck. “It just seems like somewhere along the line somebody fouled up really bad.”

MVTHS changed its natural gas provider late last year. Its former provider was the firm Centerpoint, which billed the school district on a variable, month-to-month basis. These kind of bills are based on the market price of gas.

On Dec. 19, 2013, the district signed a 24-month contract with its new provider, Constellation, which offers fixed rate billing. The district’s agent for this contract is Affordable Gas & Electric.

Even so, by the time the new contract was signed, gas prices had spiked and it was no longer feasible for the district to “lock in” rates for that winter, said AGE officials.

As a result, MVTHS was still subject to a fluctuating, variable rate during that time.

“By the time AGE gained access to the account and services were transferred from Centerpoint to Constellation, prices had already spiked and the option of buying a portion of the supply at a lower cost was no longer available,” states a written statement from MVTHS.

Superintendent Michael Smith added it was a confluence of different factors that led to the district’s excessively high gas bill for February.

On the one hand, MVTHS had a 25 percent increase in gas usage that month because of the extremely cold weather. Also, gas prices were two-and-a-half to three times higher during that time period.

“When you put those things together, we had a significant spike in our gas bill,” Smith said.

According to an AGE report, the high school used 32,265 therms of natural gas from Feb. 2 to Feb. 28, at an average rate of $0.899 per therm. This resulted in a supply bill for that month of $29,002.

Beck expressed frustration about the high gas bill at Monday’s Finance Committee meeting, saying the whole point of switching to a new provider was to save money.

“It blows my mind,” Beck said.

MVTHS officials have requested that an AGE representative attend next week’s school board meeting to explain the high bill. This meeting will take place at 7 p.m. April 21.

The school district’s gas bill for March may be on the high side as well, Smith said.

However, moving forward, school officials hope to avoid a similar situation in the future now that the district has a fixed rate contract with Constellation, he said.

“It was one of the worst winters on record, (with) record usage by all consumers,” Smith said. “It just so happened this is the same time the district was in the process of changing providers.”