Total annual average residential gas and water bill projected to decrease 7%
For additional information: Stephanie Mueller, 402.504.7776 or Jessica Heidebrecht, 402.504.7204.
December 6, 2023; Omaha, Neb.— The Metropolitan Utilities District (M.U.D.) Board of Directors today approved a 2024 budget, which continues to fund investments in critical infrastructure and people to ensure the public utility is positioned to meet ever-growing demands. Also approved were increases to the natural gas and water rates. When combined with lower natural gas costs, the average residential customer’s total gas and water bill is projected to decrease $86, or 7%, a year.
The average residential gas customer will see a 13% overall annual decrease to their bill as compared with 2023 budget assumptions. A modest increase to natural gas rates will be more than offset by a projected decrease in the cost of natural gas, which is passed through to M.U.D. customers. The annual gas bill is projected to decrease by $106 per year based on usage of 759 therms.
In addition, water customers will see a 4.7% overall annual increase to the average residential water bill as compared with 2023 budget assumptions. The annual water bill is projected to increase by $20 per year based on usage of 103 CCF (76,700 gallons).
The gas and water rate increases take effect January 2, 2024.
M.U.D. actively manages the budget to ensure operating needs are met while ensuring affordability.
“This is a responsible budget that addresses today’s challenges and ensures we continue to provide life essential services to our customers for generations to come,” said M.U.D. President Mark Doyle.
Lower cost of natural gas
The cost of natural gas, which is passed through to M.U.D. customers, is projected to be lower in 2024 as compared with 2023 budget assumptions largely due to declining natural gas prices. These declining prices are driven by higher natural gas storage levels and increased production compared to last year.
In addition, M.U.D. employs several strategies to lower natural gas costs for our customers, including long-term supply contracts and on-site storage. Approximately 74% of M.U.D.’s natural gas is purchased via prepaid agreements, which are expected to save our customers $13 million in 2024. A long-term transportation and pipeline storage agreement with Northern Natural Gas is expected to save our customers an additional $17 million next year.
On-site storage, along with pipeline storage, also contribute to the lower cost of natural gas by minimizing spot market purchases in times of high demand when gas costs are typically at their highest.
Replacing critical infrastructure
The budget will allow M.U.D. to continue updating natural gas and water infrastructure under our rigorous asset management plan. The plan is critical to ensuring M.U.D.’s customer-owners continue to receive safe, reliable natural gas and water services and meet the needs of the future.
Since 2008, M.U.D. has replaced more than 575 miles of gas mains and replaced or assessed over 150 miles of water mains. In addition to improving system reliability, this effort has reduced methane emissions associated with gas leaks. An estimated 420,000 equivalent metric tons of carbon dioxide emissions were removed from 2008 to 2022, through the natural gas infrastructure replacement program.
One of the water infrastructure challenges is the increasing frequency and cost of the more than 500 water main breaks that impact the community each year. To reverse these trends, M.U.D. is using a variety of strategies, including replacement of water mains using materials that are more resilient to corrosion. The utility has also taken a proactive approach to the problem by implementing technologies to detect water leaks, assess pipe condition and analyze data to target critical water mains for rehabilitation or replacement.
Updating facilities for increased reliability, business continuity
Capital improvement work is underway for renovations of the existing construction center, and this fall M.U.D. broke ground for a second construction center near Blair High Road and State Street. These initiatives support ongoing growth, business continuity and infrastructure replacement programs.
Work is progressing on a capital improvement project to expand the utility’s liquefied natural gas plant, an on-site storage facility. The project will substantially increase capacity and improve the reliability of the facility for the next 40 years and positively impact customer-owners for many years to come. It is scheduled for completion by the end of 2024.
M.U.D. continues to follow its Water Master Plan for system improvements, including ongoing projects for its three water production facilities. In summer 2023, M.U.D. completed a new water pumping station at 153rd and Dodge, increasing system reliability to meet peak water use in the rapidly developing area of northwest Omaha.
These large, long-term capital improvement plans are largely financed with bond issuances to spread costs over time, as the associated benefits will be realized over many years and many generations of our customer-owners.
Utility assistance, resources and affordability
Customers faced with financial hardships are encouraged to reach out to Customer Service at 402.554.6666 to discuss their account. Other tips to help manage bills include enrolling in budget billing, applying for assistance and taking action to reduce consumption. Visit mudomaha.com for more information.
As compared to 40 other U.S. utilities that participated in the 2023 Memphis Light, Gas and Water Survey, M.U.D. ranked seventh lowest in cost for residential gas bills and 15th lowest for residential water bills. M.U.D.’s affordability ranking in 2024 should be minimally impacted, as infrastructure replacement funding needs are being addressed by other utilities throughout the nation.
About M.U.D.: The mission of M.U.D., headquartered in Omaha, Nebraska, is to provide safe, reliable and cost-effective natural gas and water services to our community. Overall, M.U.D. serves more than 600,000 people in the metro area. M.U.D. is the fifth largest public natural gas utility in the United States, serving more than 239,000 customer-owners in Omaha, Bennington, Fort Calhoun, Springfield, Yutan and Bellevue. M.U.D. also provides safe, high quality drinking water to more than 225,000 customer-owners in Omaha, Bellevue, Bennington, Carter Lake, La Vista, Ralston, Waterloo and the Papio-Missouri Natural Resources District (which supplies water to Fort Calhoun). For more information, visit mudomaha.com.