Spire Inc. (Spire) engages in the purchase, retail distribution and sale of natural gas.
The company is the holding company for Spire Missouri Inc. (‘Spire Missouri’), Spire Alabama Inc. (‘Spire Alabama’), other gas utilities, and gas-related businesses.
Segments
The company has three reportable business segments: Gas Utility, Gas Marketing and Midstream.
The Gas Utility segment includes the regulated operations of Spire Missouri, Spire Alabama, Spire Gulf Inc. (‘Spire Gulf’) and Spire Missi...
Spire Inc. (Spire) engages in the purchase, retail distribution and sale of natural gas.
The company is the holding company for Spire Missouri Inc. (‘Spire Missouri’), Spire Alabama Inc. (‘Spire Alabama’), other gas utilities, and gas-related businesses.
Segments
The company has three reportable business segments: Gas Utility, Gas Marketing and Midstream.
The Gas Utility segment includes the regulated operations of Spire Missouri, Spire Alabama, Spire Gulf Inc. (‘Spire Gulf’) and Spire Mississippi Inc. (‘Spire Mississippi’) (collectively, the ‘Utilities’). Due to the seasonal nature of the Utilities’ business and the volumetric Spire Missouri rate design, earnings of Spire and each of the Utilities are typically concentrated during the heating season of November through April of each fiscal year (year ended September 2024).
The Gas Marketing segment includes Spire Marketing Inc. (‘Spire Marketing’), a wholly owned subsidiary providing natural gas marketing services.
The Midstream segment includes Spire STL Pipeline LLC (‘Spire STL Pipeline’), Spire MoGas Pipeline LLC (‘Spire MoGas Pipeline’), and Spire Storage (consisting of the operations of Spire Storage West LLC and Spire Storage Salt Plains LLC), which are subsidiaries engaged in the transportation and storage of natural gas.
Spire’s subsidiaries also engaged in the operation of a propane pipeline and risk management, among other activities.
Gas Utility
Spire Missouri is a public utility engaged in the purchase, retail distribution and sale of natural gas. Spire Missouri is the largest natural gas distribution utility system in Missouri, serving approximately 1.2 million residential, commercial and industrial customers in St. Louis, Kansas City, and other areas in Missouri. Spire Missouri purchases natural gas in the wholesale market from producers and marketers and ships the gas through interstate pipelines into its own distribution facilities for sale to residential, commercial and industrial customers. Spire Missouri also transports gas through its distribution system for certain larger customers who buy their own gas on the wholesale market. Spire Missouri delivers natural gas to customers at rates and in accordance with tariffs authorized by the Missouri Public Service Commission (MoPSC), primarily through rate cases that can take up to eleven months to be finalized. The earnings of Spire Missouri are primarily generated by the sale of heating energy.
Spire Alabama is a public utility engaged in the purchase, retail distribution and sale of natural gas principally in central and northern Alabama, serving more than 0.4 million residential, commercial and industrial customers. Spire Alabama is the largest natural gas distribution utility in the state of Alabama and is regulated by the Alabama Public Service Commission (APSC). Among the cities served by Spire Alabama are Birmingham, the center of the largest metropolitan area in the state, and Montgomery, the state capital. Spire Alabama purchases natural gas through interstate and intrastate suppliers and distributes the purchased gas through its distribution facilities for sale to residential, commercial, and industrial customers and other end-users of natural gas. Spire Alabama also transports gas through its distribution system for certain large commercial and industrial customers for a transportation fee. For most of these transportation service customers, Spire Alabama also purchases gas on the wholesale market for sale to the customer upon delivery to the Spire Alabama distribution system. All Spire Alabama services are provided to customers at rates and in accordance with tariffs authorized by the APSC.
Spire Gulf and Spire Mississippi (collectively, ‘Spire EnergySouth’) are utilities engaged in the purchase, retail distribution and sale of natural gas to 0.1 million customers in the Mobile, Alabama area and south-central Mississippi. Spire Gulf is regulated by the APSC, and Spire Mississippi is regulated by the Mississippi Public Service Commission (MSPSC).
The Utilities seek to provide reliable natural gas services at a reasonable cost, while maintaining and building secure and dependable infrastructures. The Utilities’ strategies focus on improving both performance and the ability to recover their authorized distribution costs and rates of return. The Utilities’ distribution costs are the essential, primarily fixed, expenditures they must incur to operate and maintain more than 60,000 miles of mains and services comprising their natural gas distribution systems and related storage facilities.
Customers
Spire Missouri is the only distributor of natural gas within its franchised service areas, while Spire Alabama is the main distributor of natural gas in its service areas.
Residential, commercial, and industrial customers represent approximately 93% and 84% of fiscal 2024 operating revenues for Spire Missouri and Spire Alabama, respectively.
Spire Missouri and Spire Alabama offer gas transportation service to its large commercial and industrial customers. Transportation customers represent approximately 2% and 15% of fiscal 2024 operating revenues for Spire Missouri and Spire Alabama, respectively.
Natural Gas Supply
Spire Missouri focuses its gas supply portfolio around a number of large natural gas suppliers with equity ownership or control of assets strategically situated to complement its regionally diverse firm transportation arrangements. Spire Missouri utilizes Midcontinent, Gulf Coast, Northeast, and Rocky Mountain gas sources to provide a level of supply diversity that facilitates the optimization of pricing differentials, as well as protecting against the potential of regional supply disruptions. Further, Spire STL Pipeline may deliver up to 400,000 million British thermal units (MMBtu) per day of natural gas into eastern Missouri, of which Spire Missouri is the foundation shipper with a contractual commitment of 350,000 MMBtu per day.
In fiscal 2024, Spire Missouri purchased natural gas from 29 different suppliers to meet its total service area current gas sales and storage injection requirements. Spire Missouri entered into firm agreements with suppliers including major producers and marketers providing flexibility to meet the temperature-sensitive needs of its customers. Natural gas purchased by Spire Missouri for delivery to its service areas included 40.3 billion cubic feet (Bcf) through the Southern Star Central Gas Pipeline, Inc. (Southern Star) system, 28.1 Bcf through the Enable Mississippi River Transmission LLC (MRT) system, 23.0 Bcf through the Spire STL Pipeline, 7.2 Bcf through the Tallgrass Interstate Gas Transmission, LLC (TIGT) system, 9.1 Bcf through the Panhandle Eastern Pipe Line Company, LP (PEPL) system, and 0.7 Bcf through the Rockies Express Pipeline, LLC (REX) system. Spire Missouri also holds firm transportation arrangements on several other interstate pipeline systems that provide access to gas supplies upstream. Some of Spire Missouri’s commercial and industrial customers purchased their own gas with Spire Missouri transporting 50.3 Bcf to them through its distribution system.
The fiscal 2024 peak day send out of natural gas to Spire Missouri East customers, including transportation customers, occurred on January 14, 2024. The average temperature was 0.4 degrees Fahrenheit in St. Louis, and on that day Spire Missouri East customers consumed 1.03 Bcf of natural gas. This peak day demand was met with natural gas transported to St. Louis through the MRT, Missouri Gas Pipeline LLC (now Spire MoGas Pipeline), Spire STL Pipeline, and Southern Star transportation systems, and from Spire Missouri’s on-system storage.
The fiscal 2024 peak day send out of natural gas to Spire Missouri West customers, including transportation customers, occurred on January 14, 2024. The average temperature was -9 degrees Fahrenheit in Kansas City, and on that day Spire Missouri West customers consumed 0.90 Bcf of natural gas. This peak day demand was met with natural gas transported to Kansas City through the Southern Star, PEPL, TIGT, and REX transportation systems.
Spire Alabama’s distribution system is connected to two major interstate natural gas pipeline systems, Southern Natural Gas Company, L.L.C. (Southern Natural Gas) and Transcontinental Gas Pipe Line Company, LLC (Transco). It is also connected to two intrastate natural gas pipeline systems.
Spire Alabama purchases natural gas from various natural gas producers and marketers. Certain volumes are purchased under firm contractual commitments with other volumes purchased on a spot market basis. The purchased volumes are delivered to Spire Alabama’s system using a variety of firm transportation, interruptible transportation and storage capacity arrangements designed to meet the system’s varying levels of demand.
In the fiscal year ended September 30, 2024 (fiscal 2024), Spire Alabama purchased natural gas from 23 different suppliers to meet current gas sales, storage injection, and liquefied natural gas (LNG) liquefaction requirements, of which one supplier is under a long-term supply agreement. Approximately 55.8 Bcf was purchased for delivery by Southern Natural Gas, 1.1 Bcf by BBT-AlaTenn, 4.4 Bcf by Transco, and 16.1 Bcf through intrastate pipelines to the Spire Alabama delivery points for its residential, commercial, and industrial customers.
The fiscal 2024 peak day send out for Spire Alabama was 0.6 Bcf of natural gas on January 20, 2024, when the average temperature was 20 degrees Fahrenheit in Birmingham, of which 86% was met with supplies transported through Southern Natural Gas, Transco, and intrastate facilities. The remaining 14% was fulfilled with LNG.
Spire Gulf’s distribution system is directly connected to interstate pipelines, natural gas processing plants and gas storage facilities. Spire Gulf buys from a variety of producers and marketers, with BP Energy Company being the primary supplier.
Natural Gas Storage
Spire Missouri has ample storage capacity to meet the demands of its distribution system, particularly to augment its supply during peak demand periods. Spire Missouri has a contractual right to store 22.0 Bcf of gas in MRT’s storage facility located in Unionville, Louisiana, 16.0 Bcf of gas storage in Southern Star’s system storage facilities located in Kansas and Oklahoma, and 1.4 Bcf of firm storage on PEPL’s system storage. MRT’s tariffs allow injections into storage from May 1 through November 1 and require the withdrawal from storage of all but 4.4 Bcf from November 1 through May 1. Southern Star tariffs allow both injections and withdrawals into storage year-round with ratchets that restrict the associated flows dependent upon the underlying inventory level per the contracts.
In addition, Spire Missouri supplements pipeline gas with natural gas withdrawn from its own underground storage field located in St. Louis and St. Charles Counties in Missouri. The field is designed to provide approximately 0.35 Bcf of natural gas withdrawals on a peak day and provides the ability to reinject natural gas during the heating season to replenish or increase deliverability, subject to maximum annual net withdrawals of approximately 4.0 Bcf of natural gas based on the inventory level that Spire Missouri plans to maintain.
Spire Alabama has a contractual right to store 12.7 Bcf of gas with Southern Natural Gas, 0.5 Bcf of gas with Gulf South Pipeline, 0.2 Bcf of gas with Transco and 0.2 Bcf of gas with Tennessee Gas Pipeline. In addition, Spire Alabama has 2.0 Bcf of on-system LNG storage that can provide the system with up to an additional 0.2 Bcf of natural gas daily to meet peak day demand.
Spire Gulf obtains adequate storage capacity through Gulf South Pipeline Company, LP, and Enstor Gas, LLC’s Bay Gas Storage.
Gas Marketing
Spire Marketing is engaged in the marketing of natural gas and related services throughout the U.S., which includes customers inside and outside of the Utilities’ service areas. For fiscal 2024 and 2023, Spire Marketing volumes averaged 1.32 Bcf/day and 1.40 Bcf/day, respectively. The majority of Spire Marketing’s business is derived from the procurement and physical delivery of natural gas to a diverse customer base, primarily in the central and southern U.S. Through its retail operations, Spire Marketing offers natural gas marketing services to large commercial and industrial customers, while its wholesale business consists of producers, pipelines, power generators, municipalities, storage operators, and utility companies. Wholesale activities represent a majority of the total Gas Marketing business. The Gas Marketing strategy is to leverage its market expertise and risk management skills to manage and optimize the value of its portfolio of commodity, transportation, park and loan, and storage contracts while controlling costs and acting on new marketplace opportunities.
In the course of its business, Spire Marketing enters into agreements to purchase natural gas at a future date in order to lock up supply to cover future sales commitments to its customers. To secure access to the markets it serves, Spire Marketing contracts for transportation capacity on various pipelines from pipeline companies directly and from other parties through the secondary capacity market. Throughout fiscal 2024, Spire Marketing held approximately 1 Bcf per day of firm transportation capacity. In addition, to ensure reliability of service and to provide operational flexibility, Spire Marketing enters into firm storage contracts and interruptible park and loan transactions with various companies, where it is able to buy and retain gas to be delivered at a future date, at which time it sells the natural gas to third parties. As of September 30, 2024, Spire Marketing has contracted for approximately 18 Bcf of such storage and park and loan capacity for the 2024-2025 winter season.
Spire Marketing utilizes its natural gas supply agreements, transportation agreements, park and loan agreements, storage agreements and other executory contracts to support a variety of services to its customers at competitive prices. It closely monitors and manages the natural gas commodity price and volatility risks associated with providing such services to its customers through the use of a variety of risk management activities, including the use of exchange-traded/cleared derivative instruments and other contractual arrangements. Spire Marketing is committed to managing commodity price risk while it seeks to expand the services that it now provides. Nevertheless, income from the Gas Marketing operations is subject to more fluctuations in market conditions than the Utilities’ operations.
The Gas Marketing business is directly impacted by the effects of competition in the marketplace, the impacts of new infrastructure, surplus natural gas supplies, and the addition of new demand from exports, power generation and industrial load.
Midstream
Spire’s midstream operations consist of Spire Storage West, Spire Storage Salt Plains (jointly, ‘Spire Storage’), Spire STL Pipeline, and Spire MoGas Pipeline, all at least partially under the jurisdiction of the Federal Energy Regulatory Commission (FERC).
Spire Storage West, located in southwestern Wyoming, consists of two storage fields operating under one FERC market-based rate tariff authorized to provide up to 55 Bcf of natural gas storage capacity to customers primarily in the western region of the U.S. The actual storage capacity was approximately 23 Bcf as of September 30, 2024, and management is in the process of expanding it to 39 Bcf by 2025.
Spire Storage Salt Plains is located in north central Oklahoma and serves markets in the midcontinent and midwestern U.S. Spire Storage Salt Plains is connected to Southern Star Pipeline and Oklahoma Gas Transmission. The facility operates under intrastate regulation with authorizations from FERC under Section 311 of the Natural Gas Policy Act to provide certain interstate storage, transportation, and hub services and has a certificated capacity of 13 Bcf.
Spire STL Pipeline owns and operates a FERC-regulated 65-mile pipeline connecting the Rockies Express Pipeline in Scott County, Illinois, to delivery points in St. Charles County and St. Louis County, Missouri, including Spire MoGas Pipeline and Spire Missouri’s storage facility, and its operating revenue is derived primarily from Spire Missouri as its foundation shipper.
Spire MoGas Pipeline (or simply ‘MoGas’) comprises a 263-mile FERC-regulated natural gas pipeline and a connected 75-mile gas distribution system. The MoGas pipeline, connected to the Rockies Express Pipeline, Panhandle Eastern Pipeline, Mississippi River Transmission and Spire STL Pipeline, serves natural gas utilities/municipals in western St. Louis and south-central Missouri. The distribution system serves the U.S. Army’s Fort Leonard Wood near Rolla, Missouri.
In its Midstream segment, Spire seeks to drive growth through supporting natural gas grid reliability, the ability to manage exposure to gas price volatility, and providing access to key supply basins for the shipment of natural gas. These transportation and storage operations serve a variety of natural gas customers, including Spire’s other businesses.
History
The company was founded in 1857. It was incorporated in 2000. The company was formerly known as The Laclede Group, Inc. and changed its name to Spire Inc. in 2016.
