Newsom wants the feds to investigate California's high natural gas prices

Rob Nikolewski, The San Diego Union-Tribune on

Published in Business News

Gov. Gavin Newsom on Monday jumped into the debate over the spike in natural gas prices affecting millions of California utility customers, calling on federal regulators to look at whether gouging or market manipulation is at work.

And on the local level, a few dozen protesters vented their frustrations in front the headquarters of San Diego Gas & Electric while a coalition of environmental, political and consumer groups called on the San Diego City Council to hold hearings into why SDG&E's natural gas prices soared to record highs in January.

The state's investor-owned utilities have pointed to a confluence of reasons for the dramatic increase in natural gas commodity prices, including abnormally cold weather that caused Californians to crank up their heating units. But "those known factors cannot explain the extent and longevity of the price spike," Newsom said in a letter to the chairman of the Federal Energy Regulatory Commission — the agency that oversees transmission and wholesale sale of electricity and natural gas in interstate commerce.

The California Public Utilities Commission and the California Energy Commission will hold a special hearing Tuesday but Newsom asked FERC to "focus its investigatory resources on assessing whether market manipulation, anticompetitive behavior, or other anomalous activities are driving" the high prices in gas markets in the West.

The commodity, or wholesale, price of natural gas tripled last month for the 905,000 customers in SDG&E's service territory who have natural gas hookups.

Bills for January are starting to arrive in customer's mailboxes and the utility has warned that a typical residential gas customer should brace for statements rising from $105 to about $225 — a 114 percent increase compared to January 2022.


Last week, SDG&E posted a big drop in its natural gas commodity price, predicting that it will cut February bills to $110 for a typical customer. But prices in the San Diego area will still be about twice as expensive as they were in February 2022.

The sticker shock mobilized utility customer Christine Brown to demonstrate along the streets of Kearny Mesa in front of the SDG&E building.

"This is ridiculous," said Brown, a retired businesswoman from La Mesa who helped organize the protest. "This is feels like we are living in a third world country. That's what motivated all of us to do this because we don't want to live in a backwards, regressive society. If it is not water (bills), it is electric. If it is food (prices), it is eggs. It's like, what else?"

Brown said the protest was not affiliated with any political or energy groups, saying it was a grassroots demonstration.


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