PG&E Working to Support Customers from the Impacts of Increased Energy Costs Due to Higher Cost of Gas and Colder Temperatures

Rhea-AI Summary

Pacific Gas and Electric Company (NYSE: PCG) reports a significant increase in energy bills for customers this winter, largely attributed to rising natural gas prices and unusually cold temperatures. From November to March, PG&E anticipates residential bills to rise by 32% compared to last winter. California's gas prices have been five times higher than national benchmarks, driven by increased demand and low supply. In response, PG&E supports the California Public Utilities Commission's initiative to issue the annual Climate Credit early to provide relief. The company is also implementing strategies to mitigate costs for customers and ensure long-term price stability.

Positive

• California's Public Utilities Commission voting on early Climate Credit could provide financial relief to customers.
• PG&E supports initiatives to stabilize customer bills and offset energy costs.
• Efforts to generate revenue through licensing agreements and operational improvements, like undergrounding powerlines.

Negative

• Residential energy bills expected to be 32% higher from November to March compared to last year.
• Natural gas prices in California significantly above national averages, impacting customer bills.
• Colder-than-normal temperatures leading to increased energy demand.

OAKLAND, Calif., Jan. 31, 2023 /PRNewswire/ -- Pacific Gas and Electric Company (PG&E) customers are seeing much higher energy bills this winter. PG&E knows that's a challenge for many customers and is sharing why bills are higher and how the company is supporting its customers.

The increased cost of natural gas on the West Coast and colder-than-normal temperatures are causing higher energy bills. Gas price increases this winter have been driven by higher demand and tighter supplies in California, Oregon and Washington, as customers use more natural gas for heating during colder temperatures. Power plants are also using more natural gas to meet electricity demand. More cold and dry weather is expected this week with daytime highs forecast below normal and chilly overnight lows in PG&E's service area.

Like other utility companies, PG&E does not control the market prices it pays for gas and electricity nor does PG&E mark up the cost of the energy it purchases on behalf of its customers. 

As of January 25, PG&E projects that residential combined-use gas and electricity bills will be about 32% higher from November to March, compared to the same months last winter. Bills for individual customers vary based on factors including how much energy they use. However, if gas prices fall and weather warms, bill impacts could be less severe.

Why natural gas prices are up

Natural gas prices change daily and have been much higher on the West Coast than the rest of the country since November. Between January 19 and 25, California's average daily prices were five times higher than the U.S. benchmark prices and those in New York and Chicago, according to the U.S. Energy Information Administration.

Colder temperatures in the West have caused customers to turn up the thermostat and use more energy. PG&E customers have used more natural gas this winter than the past five-year historic average, with November usage 20% higher, December 10% higher, and January to date about 3% higher.

Bill relief from California Climate Credit

PG&E is actively engaging with federal and state regulators, policymakers, and lawmakers on ways to provide bill relief.

The California Public Utilities Commission is scheduled to vote February 2 on issuing the annual April Climate Credit earlier this year, a proposal that PG&E supports. Part of the state's efforts to fight climate change, the credit is administered by PG&E and other California utilities. Residential customers who receive both gas and electric services from PG&E would receive a total bill credit of $91.17.

Separately, more than 300,000 customers who experienced financial hardships during the pandemic will receive an automatic one-time bill credit before Feb. 3 under the California Arrearage Payment Program. Customers do not need to apply for the credit and amounts will vary.

How PG&E is working to reduce costs

PG&E uses three key strategies to help moderate the impact of dynamic natural gas pricing on its customers:

• Accessing the lowest-priced gas from three gas production basins.
• Withdrawing gas from underground gas storage when demand and prices increase.
• Using financial hedging products to lock in lower prices.

PG&E is also acting to stabilize customers' bills in the long term, with a goal of keeping increases at or below assumed inflation. PG&E is working to reduce or offset investment costs in its energy system. The company generated more than $970 million by selling licensing agreements to wireless providers to attach equipment to transmission towers. It's also undergrounding powerlines to reduce recurring maintenance costs and pursuing federal funding to offset some costs of making the energy system safer and more climate resilient.

Here are three tools that customers can use now to manage winter bills:

• Keep bills predictable. Level out monthly payments and offset high seasonal bills with Budget Billing, a free tool that averages your annual energy costs to help manage monthly bills.
• Flexible payment arrangements. Extend your bill due date or make a payment arrangement. Access your online account for details.
• Customers may also qualify for financial assistance programs including the Low-Income Home Energy Assistance Program (LIHEAP), a federally-funded assistance program overseen by the state that offers one-time residential utility bill payment.

Here are three ways customers can lower energy use to save money:

• Dial down your thermostat. You can save about 2% of your heating bill for each degree that you lower the thermostat (if the turndown lasts a good part of the day or night). Turning down from 70 to 65 degrees, for example, saves about 10%.
• Lower your water heater temperature. By setting your water heater temperature to 120 degrees Fahrenheit you can reduce the amount of energy it takes to produce and maintain hot water.
• Keep areas around vents open. Furniture and carpet can block heating vents, which makes heating systems work harder and prevents rooms from heating quickly.

About PG&E

Pacific Gas and Electric Company, a subsidiary of PG&E Corporation (NYSE:PCG), is a combined natural gas and electric utility serving more than 16 million people across 70,000 square miles in Northern and Central California. For more information, visit www.pge.com/ and http://www.pge.com/about/newsroom/.

 

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SOURCE Pacific Gas and Electric Company

FAQ

Why are PG&E customers experiencing higher energy bills in January 2023?

Customers are facing higher energy bills due to increased natural gas prices and colder-than-normal temperatures, leading to higher usage for heating.

What percentage increase in energy bills does PG&E anticipate for winter 2023?

PG&E projects a 32% increase in combined-use gas and electricity bills from November to March compared to last winter.

When is the California Public Utilities Commission voting on the Climate Credit?

The California Public Utilities Commission is scheduled to vote on the Climate Credit on February 2, 2023.

What financial assistance programs does PG&E offer to customers?

PG&E engages with regulators for bill relief and supports programs like the California Climate Credit and the California Arrearage Payment Program for financially impacted customers.

What strategies is PG&E using to reduce energy costs for customers?

PG&E is accessing lower-priced gas, utilizing underground gas storage, and employing financial hedging to stabilize energy costs.