PG&E customers face higher bills in early 2023 as utility costs rise
PG&E residential customer bills are slated to rise in January 2023, an increase that the utility says may become even more pronounced this winter due to a head-spinning jump in natural gas prices.
The monthly bill for the typical residential ratepayer could jump 3% from the current levels, according to information provided to this news organization by PG&E.
The forbidding prospect of higher monthly utility bills has arrived at a time when PG&E has been attempting to improve its safety record and reduce the chances that its equipment might cause a catastrophe such as a big wildfire.
Oakland-based PG&E sketched out the background for the increase in monthly bills in a filing with state regulators that is part of the utility’s annual “true-up.” The declaration enables PG&E to consolidate rate changes approved by the Public Utilities Commission during the course of the year.
The new monthly average bill for a typical residential customer whose costs aren’t subsidized is expected to be $240.73 for ratepayers who received combined electricity and gas services from PG&E, the utility estimated. At present, the combined monthly bill for residential service is an average of $233.67.
That represents an increase of about 3% in the monthly PG&E bill for combined electricity and gas services.
The increases in the monthly costs are slated to go into effect with the January 2023 billing cycle, which means the changes are only days or weeks away.
The monthly electricity bill is due to be an average of $172.84 for the typical residential customer. The current electricity bill is $167.23 a month. That equates to an increase of 3.4%.
Bills for natural gas service are slated to average $67.89 a month for the typical residential ratepayer. The current gas bill is $66.44. That means gas bills will rise by about 2.2%.
In early 2020, the average monthly bill for combined electric and gas services was $168.85, according to a review of what PG&E reported to this news organization around that time.
As a result, by the time the new average costs go into effect in early 2023, customers will be paying 42.6% more than they were in early 2020. That’s an average increase of 14.2% a year.
In sharp contrast, the inflation rate for the Bay Area, as measured by the federal government’s consumer price index, has risen 11.3% during a similar three-year period. That’s an average of 3.8% a year.
Put another way: PG&E monthly bills have been rising well over three times as fast as the pace of the Bay Area inflation rate.
“We are working toward our longer-term goal to keep customer rate increases near the level of inflation,” PG&E spokesperson Mike Gazda said earlier this week.
PG&E has set an inflation target crafted to rein in monthly bills to increases that are in the range of 2% to 4% annually, Gazda said.
The company became a convicted felon after numerous safety violations were found to have caused a fatal gas explosion that killed eight and destroyed a San Bruno neighborhood in 2010.
PG&E equipment has triggered a series of fatal and destructive wildfires in Northern California over the last several years. While on probation for the San Bruno blast, it pleaded guiilty to 84 counts of involuntary manslaughter after its equipment sparked the Camp Fire, which destroyed the town of Paradise.
The company has launched an array of initiatives that it hopes will improve the safety and reliability of both its electricity and gas systems.
PG&E warned that its gas customers could be facing additional increases in their gas bills before temperatures start to warm up again after winter is over.
“The prices that PG&E pays for the natural gas it delivers to its customers have been rising this year,” the utility stated in a post in the PG&E Currents section of its website. “PG&E wants its customers to know their energy bills are likely to rise as well.”
Macro supply and demand factors are expected to fuel the increase in gas costs.
“Price increases have been driven by higher demand and tighter supplies on the West Coast, as customers use more natural gas for heating during cooler than normal temperatures, and as power plants use more natural gas to meet electricity demand,” PG&E stated in its Currents post.
The utility didn’t provide an estimate for precisely how monthly bills would be affected by the anticipated upcoming jump in gas costs.
“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,” PG&E stated.