Gov. Gavin Newsom is calling on the federal government to investigate the recent spike in natural gas prices that have affected ratepayers throughout California.
In a letter to the Federal Energy Regulatory Comission (FERC), the federal agency responsible for regulating wholesale, Newsom requested that the agency “immediately focus its investigatory resources on assessing whether market manipulation, anticompetitive behavior, or other anomalous activities are driving these ongoing elevated prices in the western gas markets.”
The California Public Utilities Commission (CPUC) recently voted to accelerate the California Climate Credit to help California families with high gas bills. The $90-$120 credit will be applied to residential utility customer bills starting in March for customers, including for San Diego Gas & Electric customers.
Some San Diego City leaders have also begun to ask questions of their own. San Diego City Councilman Joe LaCava read a statement at the council meeting Tuesday reiterating concerns he raised as chair of the council's Environment Committee and demanding an investigation into not only why natural gas prices skyrocketed, but why San Diego Gas & Electric did not have measures in place to protect ratepayers.
“Other investor-owned utilities employed strategies such as stockpiling, rate stabilization reserves, hedging purchases, and reducing their profits to protect ratepayers,'' LaCava said. “The committee's investigations revealed that with no proactive measures in place, SDG&E faced the choice of protecting San Diego families or protecting shareholders. They chose shareholders and passed along the high rates to the public.''
SDG&E, owned by San Diego-based Sempra Energy, alerted ratepayers in October to a coming increase and subsequently offered $1 million in customer assistance funding for those experiencing financial hardship, in addition to the bill credits.
Councilwoman Marni von Wilpert, also an Environment Committee member, said the committee is moving forward with requests to the CPUC and Gov. Gavin Newsom to demand more answers.
According to the utility, more than 90% of the increase in the overall gas rate is driven by the market price for gas — the amount SDG&E pays suppliers to buy the gas on behalf of its customers.
“Millions of California families are opening their utility bills to sticker shock – and we’re taking action now to provide relief to help with those high gas bills,” Newsom said. “We know this provides only temporary relief from soaring bills. That’s why I’m asking the federal government to use its full authority to investigate the spike in natural gas prices and take any necessary enforcement actions. We’re going to get to the bottom of this because Californians deserve to know what’s behind these exorbitant bills.”