Newsom calls for federal investigation into surging California natural gas prices
SACRAMENTO, Calif. - California Gov. Gavin Newsom Monday demanded a federal investigation into rising natural gas prices in western states, after many families across the state saw their gas bills double — or more — in the month of January.
In a letter to the Federal Energy Regulatory Commission, the group responsible for regulating wholesale natural gas, Newsom asked the agency to "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."
Many SoCalGas customers saw a massive bill in January, in many cases double the previous year. That's because, the company said, of increasing wholesale prices for natural gas. Increased prices for wholesale gas are then passed on to consumers in their monthly utility bills. According to the U.S. Energy Information Administration, this year's price spike was caused by a number of things. Colder than normal temperatures led to an increase in demand, which was exacerbated the administration said, by low natural gas storage levels on the West Coast.
In Long Beach for instance, the situation was so bad that the City Council held an emergency meeting last week to help set up a fund to help senior citizens pay their skyrocketing bills.
"California's residential customers are, consequentially, suffering the economic burden of extreme and unexpectedly high gas and electric utility bills," Newsom wrote in his letter.
The wholesale price of natural gas has dropped since last month. SoCalGas has already announced that February bills are expected to drop by nearly 70%, but the prices will still be higher than this time last year.
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But further assistance is on the way. Last week, the California Public Utilities Commission voted to make California gas companies ship out the California Climate Credit — a $90-$120 credit applied to gas bills — as soon as possible. To see how much of the credit will be applied to your household's upcoming bill, click here.
"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," Newsom said. "We’re going to get to the bottom of this because Californians deserve to know what’s behind these exorbitant bills."
The full letter from Newsom to the FERC can be read here.