Copyright 2000 The Baltimore Sun Company
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The Baltimore Sun
December 21, 2000 Thursday FINAL EDITION
SECTION: TELEGRAPH, Pg. 1A
LENGTH: 954 words
HEADLINE: As
temperature drops, natural gas price rises;
Far northern
Minn. chilled less by winds than by heating bills;
Fear in International
Falls
BYLINE: Marego Athans
SOURCE: SUN NATIONAL STAFF
DATELINE: INTERNATIONAL FALLS, MINN.
BODY:
INTERNATIONAL FALLS, Minn. - The word "cold"
is for cowards in this North Woods town that proudly calls itself the Nation's
Icebox, where it was chillier yesterday - a low of minus 7 - than anywhere else
in the country, including Barrow, Alaska.
What strikes fear among people
here is the price of natural gas, which has more than quadrupled over the past
year as supply lags behind rising demand just as blasts of
arctic air have brought colder-than-usual weather to much of the country.
The steep increase in price - from $2.168 per million
British thermal units in January to $9.326 yesterday - does not
mean that consumers' gas bills will be four times as high this winter. But they
are likely to be at least 50 percent higher, according to a federal government
forecast. And in towns like this one, a place so far north that Canadian
television comes in clearer than American television does, residents are running
out to buy stoves, firewood, window treatments and insulation. Businesses are
scrutinizing budgets for places to compensate.
Low-income families, many
of whom live in old, poorly insulated houses, worry that they must choose
between heat and medication, says Betty Mitchell, housing and energy coordinator
for a federal program that assists the poor.
Even with last year's mild
winter, it took many poor people until midsummer to pay off the winter's heating
bills.
"They are in a panic," Mitchell said.
Crude oil prices -
which hit a 10-year high in September - have dropped below $30
a barrel, but the surge in natural gas prices could halt or reverse that decline
because plants that have access to both types of energy might switch back to
oil, driving its price higher.
The price of home heating oil is about 47
percent higher than it was in December last year, and inventories of heating
oil, natural gas and gasoline are unusually low.
In pockets around the
country, electricity transmission systems are under stress. During a recent cold
snap in California, authorities scrambled to find enough electricity to prevent
blackouts.
Yesterday, the federal Energy Department ordered power to be
shifted from the Pacific Northwest to help alleviate the shortage. Still,
rolling blackouts remain a possibility because of high demand.
In
Massachusetts, more than 700,000 natural gas customers are facing the second
price increase in two months, as Keyspan Energy Delivery prepares for another
big rise in rates.
The price jumps are sending ripples through various
industries. In Louisiana and Oklahoma this month, Farmland Industries Inc.
temporarily stopped fertilizer production at two plants because of high gas
prices.
In California, milk prices are expected to rise because dairy
processors, some of the state's biggest users of natural gas, have seen their
bills increase up to tenfold recently.
Like many rural places and small
towns, International Falls is dependent on a few local industries: the Boise
Cascade paper mill, tourism, hunting, fishing and logging operations.
International Falls, which successfully fought a Colorado town to
protect its motto as the coldest spot in the country, works hard to capitalize
on the honor, displaying a giant thermometer in a local park on its Web site.
The public relations effort appears to have been successful.
"Every time there's a cold wave and it gets to 35 below, the press comes
up here to find out if we're still alive," said Alex Katrin, 71, one of a group
of men who meet at Barney's Family Restaurant for coffee, sports, politics and
gossip every morning.
But through most of the ordinary winters (anything
above zero is considered warm), people here are on their own. They're 100 miles
from the nearest heavily populated area in the United States and just over a
small bridge from Canada.
As a result, they've developed a
self-sufficient spirit and make the most of their environment. School hardly
ever closes for snow, and people chop firewood well into old age.
At the
winter carnival, people bowl with frozen turkeys. When it hits 50 below, people
like to go outside with a cupful of boiling water, toss it into the air and
watch it come down in the form of icicles.
"It's kind of nifty," said
John Fredericksen, superintendent of schools.
But this year, their
self-reliance might face a tough test.
At the Boise Cascade paper mill,
the biggest employer in International Falls, spokesman Bob Anderson said the
company's natural gas bill in October was up 82 percent over the previous year.
The company is not in the position to increase prices for its paper
products, Anderson said, so it will have to cut costs through such measures as
delaying plant improvements and possibly reducing staff through attrition.
"We certainly didn't anticipate when we made up the budgets last year
that we'd see these prices," he said.
International Falls residents are
using the same strategy in their household budgets. George and Bernice Englund,
82 and 79, just got word of a $30 increase in their natural gas
bill, from $72 to $102 each month for the
year.
They said they'll have to cut back somewhere, but it won't be easy
because they're on fixed income and have to pay $210 a month
for George's seven prescriptions.
Trish O'Brien, 36, a mother of two who
is a supervisor at Cookie's diner, said her heating bills reached
$130 a month at the coldest point last winter. She is now
bracing for an additional $65. She said she'll cut back on
groceries, bundle up and walk the half-mile to work in the cold and snow, which
was falling yesterday.
"Entertainment we'll cut down to nil," she said.
"Not that there's a lot of that here anyway."
GRAPHIC: GRAPH(S), 1. PRICE SPIKE; , 2.
INTERNATIONAL FALLS; , 1. LAMONT W. HARVEY : SUN STAFF , 2. SUN STAFF
LOAD-DATE: December 21, 2000 
