SAN DIEGO — San Diego Gas & Electric has been warning customers since October to expect higher than average rates come January thanks to soaring natural gas prices on the commodities markets.
“Basically over the past year, the natural gas market has been surging and then in recent weeks it’s gotten even higher,” said Helen Gao, senior communications manager with SDG&E.
In fact, the price of natural gas has more than doubled in the last month, with the price per therm — that’s how they measure a unit — jumping from $2.55 in December to $5.11 in January.
For example, if the average household paid $105 last January, this month it can expect to pay about $225.
“Really, we’re at the mercy of the market,” Gao told FOX 5. “Over 90% of the increase in the overall natural gas rate is due to the commodity market conditions. Basically, we go out and buy the gas in the open market for our customers and that cost that we pay is what our customers pay. There’s no markup.”
There are multiple factors driving the volatility, and demand is highest in January due to the colder weather when usage goes up.
“The energy situation in Europe, the weather conditions; for example, we’ve had widespread below average temperatures across this country,” Gao said. “That drove up natural gas consumption that impacted the market.”
To help households mitigate the increase, the utility company has created an entire page on the SDG&E website offering ways to save.
“This not good news for them but the most important thing for customers to know is that we are here to help them,” Gao said. “There are a lot of assistance programs available, probably more than most people think there are.”