KANSAS CITY, Mo. — Driven primarily by continued high prices for natural gas, home energy costs remain a significant driver of inflation, according to the latest data for February 2022 from the Bureau of Labor Statistics.
Overall household energy costs in the Midwest Region rose 1.8% from January to February, according to the updated Consumer Price Index for the region that includes Kansas City and its suburbs.
Household energy costs have ballooned 14.7% in the last year. Experts thought prices might normalize, but a "perfect storm" helped keep prices high.
"I was feeling very optimistic and then two going on three weeks ago, Russia invading Ukraine, all bets are off," Larry Wigger, a supply chain management professor at the University of Missouri-Kansas City, said. "That's a huge chunk of our supply coming out."
The price inflation for natural gas adds nearly $15 per every $100 for a typical residential bill for piped natural gas service compared to February 2021.
Natural gas prices surged to record levels last winter as a polar vortex plunged the Midwest into a deep freeze for a week last February and remain exceptionally high.
The cost for piped service rose 2% last month, but it has advanced 31.5% since last February, driving the spike in household energy costs.
Both outpaced the national average.
Across the country, natural gas prices remained flat from January to February and were only up 23.8%, or nearly 8% less than the Midwest Region.
Kansas and Missouri are included in the Midwest Region along with Illinois, Indiana, Michigan, Minnesota, Nebraska, North Dakota, Ohio, South Dakota and Wisconsin.
Electricity costs also have risen in the Midwest region, but by a relatively modest 5.9% in the last year — more than five times less than the rate of inflation for natural gas.
Only the cost of gasoline (34.5%) and used cars (41.5%) have risen more sharply in the last year than the price of natural gas.
Overall inflation grew 0.9% in February and stands at 8% in the last year, which is in line with national averages, but shows little sign of stopping.
"You're going to keep reporting record inflation numbers for a while, I'm afraid," Wigger said.
