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Home Energy Natural gas cost hike may lead to higher electricity bills in June

Natural gas cost hike may lead to higher electricity bills in June


ORANGE, Calif (KABC) — The California Public Utilities Commission held a virtual hearing Tuesday, where experts in the industry discussed the impact high natural gas rates have on the cost of electricity.

Like many living across the west, John Woods saw his natural gas bill double at the start of the year.

“The first thing I checked was for leaks because it was kind of ridiculous that it would go that high,” Woods said.

Though some relief is on the way, another utility bill may soon shock customers.

Electricity markets are heavily dependent on the gas market.

Data from the US Energy Information Administration shows wholesale electricity prices in Southern California hit $250 per megawatt hour this past December. That’s well above prices seen in previous years.

The Manager of Monitoring and Reporting with the California Independent System Operator’s Dept. of Market Monitoring, Amelia Blanke, said when compared to December 2021, the wholesale cost of energy was much higher this past December.

“The wholesale energy cost in December alone is $3 billion higher than it would have been if natural gas prices had been lower, so that’s a comparison essentially of December’s wholesale energy cost estimate to the estimate of December in the year previous,” Blanke said.

This could mean a hike in electricity costs for SoCal Edison customers in June.

The Vice President of Energy Procurement and Management with SCT, William Walsh, said the utility company filed an Energy Resource Recover Account, or ERRA, trigger application requesting rate increases to take care of their forecasted spike in energy costs.

“We made that filing here at the end of January, requesting close to $600 million in a rate increase that would be effective June 1. Now that’s about a 4.4% increase for our bundle customer in generation rates,” Walsh said.

Walsh said if prices sub correct, SCE can update its filing in the spring, hopefully avoiding nearly a 4.5% increase this summer.

Meanwhile, customer patience is pretty much running out.

“It just seems to me like unfair greed because if we all pay a lot more, very few people get a lot more,” Woods said.

CPUC President, Alice Busching Reynolds, reminded customers to be on the lookout for a climate credit on their utility bills in the next billing cycle. It could be up to anywhere between $90 to $122.

Regardless of relief on the way, people called in during the public comment portion of the hearing and were very upset, demanding an investigation.

Reynolds said the commission would continue to examine whether an investigation into the gas rate hikes was necessary.

As the hearing closed, Reynolds reminded everyone the El Paso gas line was expected to be back in service by Feb.15, which should help bring down the price of natural gas.

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