|
Mayor seeks to reopen natural gas deal for city |
|
Tuesday, 16 June 2009 |
By WILLIAM LANEY
Managing Editor
With natural gas prices declining, a Wapakoneta administrator plans to inquire if negotiations can be entered into early with the provider of natural gas for the city’s aggregation program.
Wapakoneta Mayor Rodney Metz said he intends to learn if negotiations can start early with the provider, Direct Energy, to take advantage of natural gas prices which are a couple dollars lower per unit than the $10.46 per mcf the city is paying now.
“I don’t know if those negotiations can be opened up early, but I will be asking and finding out,” Metz said. “I think we need to do that because prices are down, and our residents that are using our services need the best price we can negotiate for them.”
The existing 1-year contract ends Nov. 30. A price is typically negotiated in August and September.
Metz said American Municipal Power of Ohio (AMP-Ohio) helped negotiate the contract last summer. The contract locked in the $10.46 per mcf price, an increase from $9.97 per mcf paid the previous year.
“At the time, we felt it was an excellent price because it was a slight increase but little did we know the economy would dive deeper into a recession and natural gas prices would slide,” Metz said. “The contract before that we entered into early and the prices increased considerably during the winter season.”
With natural gas reserves climbing, the price has fallen into the $8 per mcf range, according to one city councilor.
“Hopefully they will allow us to open up the contract,” Metz said. “I would like to caution the residents to make sure there are no penalties in their contracts that they have entered into if they decide to get out of their deal.”
During Monday’s meeting, Councilor-at-large Wilbur Wells suggested city administrators consider negotiating a natural gas price now rather than wait until the fall when prices may increase prior to the winter heating season.
“I think it would be in the best interest for us and our residents if we can negotiate that contract now and not wait until the contract expires,” Wells said.
Wapakoneta 1st Ward Councilor Jim Neumeier supported Wells’ suggestion.
“If Direct Energy thinks they will lose a lot of customers they may be willing to open up negotiations now,” Neumeier said. “It may be as simple as calling and talking to Direct Energy representatives.”
Safety-Service Director Rex Katterheinrich said getting the best price is “like hitting a moving target.” Katterheinrich advised councilors to tell residents to investigate their options and “do what is in their best financial interests.”
|
|
Last Updated ( Wednesday, 17 June 2009 )
|
