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    Lower Keys power rates to rise amid natural gas crunch

    July 1, 2022 - Elliot Weld


      LOWER KEYS - Keys Energy Services announced recently that customers will see increased rates on their June energy bills because of the cost of natural gas rising nationwide.

      The utility, which provides power service to Florida Keys residents living south of the Seven Mile Bridge, added a power cost adjustment charge to its bills in January 2022, which can either be positive or negative depending on the behavior of global energy markets.

      That charge will be $74.65 per 1,000 kilowatt hours for June bills, up from $26.30 in May.

      The average total bill for a Keys Energy customer consuming 1,000 kilowatt hours of power in June will be $210. In May, the same rate was $161.65, according to a KEYS news release.

      "The cost of natural gas had been at record lows in recent years and these savings were passed along to our customers in the form of a credit," CEO Lynne Tejeda said in the release.

      "The price of natural gas has surged over the last year, and what had been a credit has escalated to a charge."

      Tejeda cited disruptions in natural gas production, reduced rig counts during the pandemic, lower gas storage inventory and the exporting of fuel as a result of the Ukraine War as factors in the price flux. She added the company will pass further price increases in natural gas along to customers.

      KEYS customers received a text message stating "increased natural gas costs are driving the cost of energy higher" and provided a link with more information about the increase and power saving.

      Keys Energy's power sources come from the Florida Municipal Power Agency, which generates most of its electricity through natural gas. A breakdown provided by Julio Torrado, communications director for Keys Energy, showed 78% of that power is from natural gas, another 18% comes from coal, 1.8% from nuclear, 1.1% from solar and 1.1% comes from "other" sources such as diesel.

      Torrado said they often get questions about why the company is not investing more in solar power.

      "The answer is, we are!" Torrado wrote in an email.

      "In 2018 we made a commitment to the Florida Municipal Solar Project. As planned then, by the end of 2023 we were slated to have 10% of our power generated from solar farms in the state of Florida. We are currently getting a small percentage of solar power from phase one of the project, but given current supply chain issues in procuring solar panels, the full amount of power we committed to purchase is not slated to come online until 2023 at the earliest."

      Torrado added that the Key West Utility Board will be reviewing bids to make additional commitments to the Florida Municipal Solar Project and grow that percentage.

      Natural gas and other energy sources are just one commodity that have experienced soaring prices amid some of the most intense inflation in decades. Reuters reported in early May that natural gas prices hit a 13-year high of $8.74 per million British thermal units.

      A number of factors can feed into this, including weather. With record temperatures scorching much of the continental U.S. this summer, businesses and residential power consumers use more gas to keep cool. Lack of storage is another factor, according to Reuters.

      The spring is usually when natural gas companies build up gas stock in preparation for cold months, when more of it is needed. But that has not happened this year, partially because rising overseas demand and fears over additional curtailment of global energy supply.

      For tips on saving energy and other information, visit


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