Utility rates rising again in Colorado Springs, effective Friday, due to continued increase in natural gas prices

COLORADO SPRINGS, Colo. (KRDO) -- For the second time in less than a year, the City Council has unanimously approved a request from Colorado Springs Utilities to raise rates for natural gas and electricity.

A Springs Utilities representative told the Council during Tuesday's meeting that the rate increase begins July 1, and will add around $27 to the average monthly residential bill.

"It's going to cost even more for business customers and industrial customers," said Tom Strand, Council president. "We realize that everyone will be affected."

Rates increased last fall because of heavy winter demand for energy, he said, and natural gas costs continue to rise because of the war between Russia and Ukraine and the increase in foreign demand for liquefied natural gas.

"We do review the electric and gas cost adjustments on a quarterly basis," said utility spokesman Tristan Gearhart. "So we will come back at the next quarter and see if a further adjustment is needed. And really, that's going to depend on what the natural gas market does. We've seen a lot of volatility in that throughout the year, to this point."

Springs Utilities reduced rates in February and May when natural gas became less expensive, but the utility said that costs still aren't as low as expected -- and in fact, are rising again.

This latest increases comes while many citizens are still struggling to make ends meet during the COVID-19 pandemic, and as the utility installs six new power generators fueled by natural gas.

"Just a few months ago, you said our bill would go down," ratepayer Natalie Ashton told the Council. "It took about two months for my bill to reduce, and it reduced $11. And then when you say it goes up, it happens immediately -- and it's like $50 more."

Approximately half of the utility's energy portfolio is provided by natural gas, as part of a gradual transition away from coal -- highlighted by the early decommissioning of the Drake Power Plant near downtown.

Springs Utilities said that while natural gas costs have risen 50% in the past ten years, natural gas generation is still cheaper than coal generation because of faster start-up times and lower overhead costs.

The Council advised customers to start thinking about how they can save energy now -- before winter -- and (if necessary) contact the utility and other payment assistance programs such as Project COPE, which provided nearly $136,000 in assistance to almost 240 households last season.