Division of Energy

Missouri’s Total State Bill for Natural Gas at a Glance

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Figure 1

Missouri’s Total Expenditures for Natural Gas, 2009: Distribution by Sector

About 73 percent of Missouri’s natural gas bill is paid by residential and commercial users for applications such as space heating, water heating and cooling (see Figure 1). According to the U.S. Energy Information Administration, natural gas is the primary heating fuel in 60 percent of Missouri households.

In 2009, Missouri ranked 13th among states in natural gas expenditures by the residential sector, 16th in expenditures by the commercial sector, 20th in expenditures by the industrial sector and 35th in natural gas expenditures by the electric utility sector. Missouri ranked 19th in total expenditures for natural gas.

The industrial and electric utility sectors account for 26.7 percent of Missouri’s natural gas bill, with each sector accounting for 35.7 percent of natural gas used.  Nationally, half of all natural gas is used by the industrial and electric utility sectors. 

Changes in Missouri’s Total Expenditures for Natural Gas, 1989-2009

Figure 2

Expenditures for natural gas, like that for electricity and transportation fuels, trended upward through the 1990s and 2000’s. The state’s natural gas bill in 2009 was about 141 percent higher than in 1989, but it is 16 percent lower than expenditures in 2006 (see Figure 2).  

However, expenditures for natural gas did not move consistently in one direction but varied between 1989 and 2009 depending on severity of the winter.  Figure 3 shows the average number of heating degree days (i.e., days with temperature below 65 degrees Fahrenheit) in Missouri for each year between 1989 and 2009.  The number of heating days varies considerably from year-to–year.  However, the overall trend, shown by the solid straight line, is negative.  This indicates, on average, Missouri is experiencing fewer cold days in the later years of the decade, compared to the earlier years).  However, this gradual warming is not necessarily the cause of the recent drop in natural gas expenditures.

Missouri natural gas costs increased dramatically between 2002 and 2006, but have experienced a slow decline since (see Figure 4).  The values in Figure 4 represent the annual prices paid by each sector.  In the residential sector, natural gas prices increased between 2002 and 2006 at a compound annual growth rate of 14.9% and decreased between 2006 and 2009 at a compound annual growth rate of 4.0%.  In the commercial sector prices increased between 2002 and 2006 at a compound annual growth rate of 16.0% and decreased between 2006 and 2009 at a compound annual growth rate of 5.7%.  In the industrial sector prices increased between 2002 and 2006 at a compound annual growth rate of 18.3% and decreased between 2006 and 2009 at a compound annual growth rate of 12.2%. 

Figure 3

Figure 4

Figure 5

Figure 5 shows the overall pattern of natural gas consumption between 1989 and 2009.  The trend line for the commercial and industrial sectors is essentially flat.  Natural gas use in the residential sector shows a generally negative trend, peaking in 1996 and falling so that by 2009, the average number of BTUs consumed is roughly 1.0% lower than the consumption in 1989.  In contrast, the average number of BTUs consumed by the electric power sector rose 17.2% between 1989 and 2009.

The general trend in natural gas expenditures suggests a severe reduction between 2008 and 2009.  Accompanying this reduction are changes in the weather, reductions in natural gas prices (due to the availability of shale gas), and reductions in consumption in the residential sector.  In 2009, natural gas consumption in the residential sector was at its lowest point in twenty years.  While the immediate reduction in expenditures can be attributed to immediate economic conditions such as the 2008-2009 economic recession, increases in supply are likely to lead to long-term stability in natural gas prices for utilities and stability in natural gas expenditures for Missouri residents.

Data Sources: Statistics presented in this fact sheet are based on energy consumption, price and expenditure data from the State Energy Data System, SEDS, provided by the U.S. Department of Energy's Energy Information Administration, EIA.  In addition to the SEDS data, EIA also provides more recent data on average residential, commercial and industrial electricity prices.