The Minnesota Senate passed on March 25 on a bipartisan vote, legislation that establishes a 2021 Polar Vortex Loan Account for municipal utilities that purchased natural gas during the extreme weather that occurred in February 2021. The bill provides $15 million from the General Fund for zero-interest loans that need to be repaid within five years.
“Municipal utilities can’t carry the burden they face as a result of the price increase due to the events that happened in February,” said Sen. Zach Duckworth, R-Lakeville, in a press release. “Without immediate action, they would’ve been forced to pass these fees on to Minnesota families through bills that could’ve been triple the normal cost.”
Due to varying factors from the polar vortex that occurred from Feb. 12-17, the price of natural gas had an unprecedented price surge for Texas and all the Midwest. In Minnesota, all natural gas utilities were hit by this price surge while also coinciding with a cold snap, meaning consumers were using more and paying a higher rate for the natural gas.
During these five days, some utilities spent their entire gas purchasing budget for the year. The residential impact range is estimated from $250-$500 for a typical residence for those five days alone. For businesses, an example was given where one business that typically spends $12,500 a month on gas could be facing a bill of $125,000 due to the spike.
The Polar Vortex Loan Account would grant municipal utilities the option to help pay their bills now and to spread consumer payments out over the five-year repayment term which could greatly reduce the impact on consumers and Minnesota families.
Senate File 1018 passed off the Senate floor with unanimous support.