PG&E monthly natural gas bills double, some customers report
Soaring prices for natural gas and this winter’s icy blasts have jolted unsuspecting PG&E customers with brutal — and fast-rising — monthly utility bills.
“I almost fell over when I got my bill,” said Nicole Murray, of Pleasanton, who was astounded at the total for PG&E gas and electricity services. “It was horrifying.”
For years, Murray said her PG&E bill typically ranged from $300 to $400 a month. Starting late in 2022 and so far in 2023, her PG&E bill is closer to $800 a month.
Experts point to an array of factors driving California’s crushing surge in monthly utility bills — with natural gas prices, especially, a culprit.
“The natural gas costs are really high, but just in California and on the West Coast,” said Severin Borenstein, director of UC Berkeley’s Energy Institute at Haas. “In the rest of the U.S., natural gas has become cheap, very cheap.”
“One factor is gas pipeline capacity,” Borenstein said. “If we had more pipeline capacity, you would see more gas going from low-cost areas to the West Coast.”
Plus, reserves of natural gas aren’t available to the same extent as in years past.
“We have less storage on the West Coast than in past years,” Borenstein said. “When we don’t have as much storage of natural gas, prices can go through the roof.”
One major complication: The gas storage field at Aliso Canyon in the San
Fernando Valley region of Los Angeles County suffered a massive leak in 2015 that forced the shutdown of the energy complex in 2016. In 2017, Southern California Gas resumed storage in the field, although on a limited basis.
In January, Bay Area prices for natural gas piped into the home — roughly equivalent to PG&E gas services — rocketed higher by 24.4% compared to January 2022, according to the U.S. Bureau of
Labor Statistics. That was a big jump from December’s annualized increase of 14.7%. And it was the largest yearto-year increase since September 2022, this news organization’s analysis of the federal agency’s report determined.
The Bay Area’s recent frigid weather, punctuated this month by unusual snow storms, also has contributed to the jump in PG&E bills.
“We had a very cold November and December, and that drove up demand as supply was constrained,” Borenstein said.
Frank and Adele
Frausto thought they had successfully warded off soaring utility bills after they installed a solar panel system for their house in San Jose’s Evergreen district.
“Our combined gas and electric bill used to be
$200 a month,” Frank said. “Now, gas only is $300 a month. And that’s with solar. … It’s crazy how high our PG&E bills are.”
Oakland-based PG&E also appears to have harvested a big increase in revenue from recent gas operations.
During 2022, PG&E generated $6.62 billion in revenue from its gas utility operations, up 20.1% from the $5.51 billion PG&E realized in 2021 from gas revenue.
During the Octoberthrough-december fourth quarter of 2022, PG&E generated $2.05 billion in revenue from natural gas utility operations, up 24.2% from the $1.65 billion in revenue in the fourth quarter of 2021.
Gas revenue is rising at a much faster rate than the utility’s overall revenue, the company’s annual report shows. In 2022, PG&E realized total revenue of $21.68 billion from electricity and gas operations, an increase of 0.5% from the $20.64 billion in revenue in 2021.
“PG&E doesn’t control the market prices for natural gas,” said
Lynsey Paulo, a PG&E spokesperson. “We don’t mark up the price. From November through
January, our natural gas market prices were extremely high, in some cases, six times higher than the U.S. benchmark.”
California’s major utilities also are obliged to transport the vast majority of their wholesale natural gas for use by their customers.
“The huge price differentials between the West Coast and the rest of the country tells us that transport capacity between the areas is constrained. In fact, we knew this coming into the winter,” Borenstein wrote in a blog post. “A pipeline explosion from 2021 reduced capacity to move gas from the producing regions in and around Texas, the source of much of our supply.”