NEW ULM– Gas prices at the pump have been on the rise for some time, but natural gas prices have risen consistently higher.

Throughout May, daily natural gas prices ranged between $7 and $8 Mcf. This is four times the average price of natural gas from a year ago. April 30, 2021, saw an average natural gas price of $2.46 per Mcf.

New Ulm Public Utilities Director Kris Manderfeld told the Public Utilities Commission Tuesday that this trend represented a 14-year high for natural gas.

New Ulm has seen a significant spike in natural gas in recent years. Prices nearly tripled in February of 2021, but this was related to the polar vortex shutting down the grid in Texas and cutting off supply. It was also a short-term increase.

The current increase in natural gas is consistent, and unlike previous increases, there doesn’t seem to be a fundamental reason for the increase.

Manderfeld said storage is often a driver of gas prices, but this year has not been different from previous years. The natural gas supply also remained the same, and drilling is increasing.

NUPU is working with Kinect Energy to assist with buying natural gas, and according to the energy company, the only thing driving up the price is fear.

Fear and uncertainty are the only new variables in the price increase. The law of supply and demand is also a factor. Manderfeld said people are still buying natural gas even at this price. The market has not yet reached a point where people will stop buying it.

Currently, NUPU has avoided paying the extra cost by participating in a natural gas hedging program. Through this program, New Ulm buys a portion of its natural gas at a lock-in price to keep utilities stable.

Manderfeld said gas was locked in at $2.77 per Mcf for the year. This is a significant discount from the daily market price, which reached $8.33 per Mcf on May 25.

“Sometimes you win on hedges and sometimes you lose, but in this particular case, we are definitely winning,” Manderfeld said.