The West Deptford Energy LLC power station, fueled by natural gas, is viewed behind a field of solar panels in Paulsboro, N.J. Rising energy prices on the regional power grid have caused customer rates to increase at many Pennsylvania electric utilities.

Utility bills in the Philadelphia area are soaring and so have customers – The Philadelphia Inquirer

Byron Goldstein closely monitors energy use in his Glenside home. So when he got a $651 bill from Peco Energy for using his electricity and gas together in January, 37% more than the $477 he paid last January, he knew something was off.

Goldstein discovered that Beko’s gas supply shipment had risen significantly since January 2021, accounting for most of the increase. Goldstein, 74, was unhappy with the company’s response to his phone calls, so he filed a formal complaint with Pennsylvania Public Utilities Commissionand urged the state regulator to reverse the “obscene and irresponsible” price increase for Peco.

He was not alone. Across the Philadelphia area, thousands of utility customers have opened their bills in recent weeks learning that the cost of heating their homes has risen well above the 7% inflation rate. Social media platforms ignited posts from unhappy customers, channeling their discontent at energy companies, regulators and politicians.

In his post, a Philadelphia resident wrote: “I didn’t pay that much for the winter heat.” Nextdoor.comwhere several threads contained hundreds of comments venting the price hike.

The price has really gone up: A typical Peco customer who used 150 hundred cubic feet of gas was billed $171.25 in January, up 38%, or $46.90, from January 2021, According to PUC . data. A Philadelphia gas customer who used the same amount of gas was billed $261.71 in January, up 17%, or $37.91, from a year ago.

Electricity bills in Pennsylvania also rose on December 1, but not as much as gas bills.

The reason for the increased utility bill is straightforward: energy prices have gone up all over the world. You see it at the gas pump. Residents of furnaces using heating oil or propane test it. Natural gas prices, which determine the market price of electricity, have doubled in the past year.

There is much fervent debate about who or what is responsible for energy prices. In 2020, during pandemic lockdowns, energy demand has plummeted and fuel prices have fallen to their lowest levels in a decade. The global economy is now booming, and the demand and prices for energy are rising, especially in markets where there is a shortage of supply.

With tensions rising over Russia’s invasion of Ukraine, global energy markets are bracing for what could become a crippling disruption in the supply chain if the conflict affects pipelines transporting Russian natural gas on which Europe depends. Germany also suspended the launch of the giant Nord Stream 2 gas pipeline, which has not yet entered service.

“The prices of natural gas, along with other heating fuels, are increasing worldwide, due to a combination of factors,” Peco spokeswoman Mayra Bergman said in an email. “In addition, this winter has been colder than last year, which has led to increased energy consumption and increased energy bills for both natural gas and electric customers.”

It’s not just Pennsylvania. Commodity prices for New Jersey utilities customers are higher this year than the previous five, according to the New Jersey Board of Public Utilities, the state’s regulator.

“New Jersey customers may experience an increase in their gas and electric bills this year compared to previous years,” a BPU spokesperson said in a written response to questions. He said the BPU is not an annual comparison of utility prices in the state.

In October, a Average price of natural gas in the US It was $5.51 per 1,000 cubic feet, more than double the price from the previous year, according to the US Energy Information Administration.

Gas prices haven’t gone that high since the winter of 2014, when the infamous polar vortex sent average prices to $6 per unit.

However, doubling the price of the commodity does not mean doubling the gas bills, because the cost of natural gas itself is only a part of the customer’s bill.

The rule of thumb 10 years ago was that energy costs were about two-thirds of a customer’s bill. But energy prices have plummeted in the past decade, with the advent of US shale gas production, and it now accounts for less than half of a typical utility bill.

With energy prices falling, regulators have encouraged utilities to step up replacement of aging infrastructure. This has contributed to an increase in utility distribution fees to pay for networks that provide power to customers. These increases partially offset the decrease in energy costs. Distribution costs now represent the largest portion of a customer’s invoice.

State regulators carefully review and approve the distribution rates charged by utilities, allowing private utilities to include a profit margin. The utility-rate case is a laborious procedure in which opponents, including consumer advocates, are allowed to challenge the proposed price of a utility. Because the rate case is expensive and takes nine months to review, utilities only seek to increase the rate every few years.

But the commodity fee is different. In Pennsylvania, utilities are allowed to adjust energy costs every three months to reflect fluctuations in the price you pay for gas or electricity. They are not allowed to make a profit on fuel costs – the cost is passed on to customers without a profit margin. The organizers review fuel surcharges annually to ensure that the charges are justified.

“The union is supervising this purchase,” said Terence J. Fitzpatrick, president of the Pennsylvania Energy Consortium, a utility trade group. “It is structured to make sure you pay a fair market price for it. There is no profit made from selling that power to customers.”

Fuel costs for the various Pennsylvania facilities are not moving in unison. Utilities have various arrangements to purchase gas from suppliers to ensure they have a reliable supply on the coldest days of winter. Some gas is purchased on seasonal contracts at fixed prices. Some of them are bought in the spot market at current prices. Peco and PGW also buy gas in the summer and store it locally in the form of liquefied natural gas (LNG), the main purpose of which is to ensure supply in peak winter days when customer demand is high.

Pennsylvania utilities recently increased energy charges on their electricity and gas bills on December 1st. Peco . company issue a notice For its natural gas customers, it warns that some bills may increase by 24%. But many customers did not seem to notice because the weather in December was relatively mild, blunting the impact of higher energy prices.

But January weather has been the coldest of any month in the past four years in Philadelphia. Combined with higher energy charges, this has generated some interesting bills. So far in 2022, Peco has delivered 17% more gas to customers than expected.

Utilities say they are getting more apps from customers to help pay bills.

More than 150,000 New Jersey families enrolled in the state’s Universal Service Fund program in the last three months of 2021, exceeding the number offered in the previous nine months. But it is unclear whether this increase is due to higher prices or the end of pandemic-related assistance programmes, Peter Beritzman, a spokesman for BP’s business unit, said in an email.

Pennsylvania utilities are also seeing greater involvement in assistance programs, said Fitzpatrick of the Utility Trade Association. “I heard they’re seeing some activity, which they attribute to the cooler temperatures and the fact that energy prices are going up.”

Requests for assistance may be accepted as soon as the April 1 deadline when the winter moratorium on lockdown ends. Public utilities are prohibited from stopping non-paying customers during cold weather.

Although the recent increase in utility bills is shocking to many, the cost of energy is actually lower than it was 15 years ago. A Peco residential customer who used 150 cubic feet and was billed $171.25 in January, would have paid $193.64 in 2007. Adjusted for inflation, this 2007 bill would be $268.96

But clients can have short memories. “Someone once said that from a political point of view, the only kind of energy prices we like are low prices,” Fitzpatrick said.

Goldstein, the owner of the Glenside home, received an official response from Peco’s attorney Thursday asking PUC to dismiss his complaint. The facility said the public was notified of price changes, and that higher energy costs were “expected” for Pennsylvania customers who use natural gas, fuel oil and propane.

Goldstein also received the electricity and gas bill for February last week. It was for $624, up from $463 a year ago.

It is scheduled to adjust the price of gas next to Beko on the first of March Not announced yet. The new price of electricity is already Published on PUC’s website – It will rise by about 0.6% next Tuesday.

The Philadelphia Inquirer is one of more than 20 news organizations that produce Broke in Philly, a collaborative reporting project on solutions to poverty and moving the city toward economic justice. See all our reports at breakinphilly.org.

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