San Diego Gas and Electric warned customers that soring wholesale natural gas prices over the past year have contributed to the dramatic increase in ratepayer’s bills this month.
The utility implemented new natural gas and electric rates on Jan 1, 2023, which doubled the cost per unit of natural gas (therm) from $2.36 per therm in 2022 to $5.11 per therm in January 2023. More than 90% of the increase in the overall gas rate is driven by the market price for gas – what SDG&E pays suppliers to buy the gas on behalf of our customers.
The increase means that if your household peak winter gas bill was around $105 last January, you can expect your January 2023 bill to be about $225. Customers who are enrolled in the CARE bill discount program could see their January gas bill increase from about $60 to $130.
“We understand the challenges customers are facing as the cost of goods and services across the board continues to increase. While not good news, we want to make sure our customers are prepared for significantly higher winter bills, and more importantly, that there are tools and resources, including financial assistance available, given the severity of natural gas market conditions,” said SDG&E Vice President of Customer Services Dana Golan. “Please know that we are here to help and work with our customers who may be struggling financially.”
A typical SDG&E residential customer who receives both electric delivery and electric generation (bundled service) from SDG&E may see their average monthly electric bill increase by about $25 from about $160 to about $185 starting in January. Customers enrolled in the utility’s discount program may see bills increase from an estimated $105 to $120.
Community Choice Aggregation (CCA) customers who receive electric generation from their CCA could see the electric delivery portion of their bill increase by about $10.
SDG&E leaders said they do not charge any markup for natural gas — if the utility pays $1 for natural gas in the commodity market, that's what customers pay. The utility began alerting customers about rising gas prices and anticipated rate changes in October so they could be better prepared.
According to the U.S. Energy Information Administration, a convergence of circumstances resulted in the escalating price levels: widespread, below-normal temperatures; high natural gas consumption; reduced natural gas flows; pipeline constraints, including maintenance in West Texas; and low natural gas storage levels in the Pacific region.
SDG&E provided the following tips to help customers cut their winter energy bill by reducing consumption:
- Lower your thermostat: You can save as much as 10% per year on heating and cooling by turning your thermostat down 7-10 °F for 8 hours a day in the fall and winter, health permitting.
- Control humidity: Instead of reaching for the thermostat, use a humidifier to keep your home humidity between 30 and 50%. You'll feel warmer with some humidity in the air.
- Wash with cold water: Washing clothes in cold water can save you up to 10% on water heating costs
- Stop the breeze: Caulk and weather-strip around drafty doors and windows.
- Reduce the use of non-essential appliances: Spas, pool heaters, and fireplaces can use a significant amount of gas or electricity.