Relief nigh for gas price pains
Maybe the governor called a special legislative session for the wrong type of gas price.
In the face of wallet-busting gasoline prices across the state last summer, Gov. Gavin Newsom convened a special session of the state Legislature in December to tax the “excessive” profits of California oil refiners. But since then, prices at the pump have fallen back to their still-high-but-not-uncharacteristically-so California average, according to AAA.
In the meantime, Californians are getting hammered with the soaring cost of natural gas. Wholesale prices for the home-heating, water-boiling, climatewarming commodity rose 63% since October, even while prices nationwide were cut in half, Bloomberg reports.
Even that vertiginous average conceals much higher spikes in some locales.
Andra Bard, a Santa Monica resident whose typical bill of $68 clocked in at $330 last month: “It's just shocking… This can't be sustainable.”
But lower bills may be on the way.
With some supply bottlenecks easing up, utilities are already promising a steep reduction in prices.
And today, the state's Public Utilities Commission is expected to vote on offering Californians some financial relief by speeding up the rollout of an annual bill-reducing credit.
The California Climate Credit, meant to compensate households for higher energy bills that result from the state's emission reducing cap-and-trade program, is scheduled to go out in April from the natural gas companies. But the utility commission's public advocate seeks an emergency order to get the money out this month, to help cover astronomically high January bills.
If approved, the credit is expected to give customers roughly $50 each. Pacific Gas & Electric, San Diego Gas & Electric and SoCal Gas all support the move. So do state Senate Republicans, who wrote the CPUC on Monday urging them to send out the credit “as soon as possible.”
The utilities commission is set for a broader discussion on natural gas prices Tuesday.
Those prices began their eye-watering ascent along the West Coast in December. Although some consumer advocates are calling for an investigation into possible market manipulation, analysts at the federal Energy Information Administration laid the blame on that familiar duo, supply and demand.
• High demand: Unusually cold weather has pushed Californians to throttle their thermostats.
• Low supply: Infrastructure repairs in Texas and high gasoline demand in Canada resulted in fewer imports to California, which gets almost 90% of its natural gas from out of state. Lower-than-normal stockpiles in Northern California reduced the available slack in the system.
High natural gas prices cast painful economic ripples: Much of the power that California uses during peak hours come from gas-powered plants. That means higher natural gas prices might also be spilling over onto your electricity bill. In a new poll from the Public Policy Institute of California, six in 10 Californians say that recent price increases have caused financial hardship.
Meanwhile, with the Legislature slowly considering his still-to-be-fleshed-out oil tax proposal, Newsom continued his war of words with major oil companies this week.
According to recordbreaking earnings reports released Tuesday, last year unleashed a geyser of cash for the nation's oil giants. That prompted a predictable excoriation from the governor.