A consumer advocacy group says that Illinois consumers could pay hundreds of dollars more in gas bills to heat their homes this winter due to skyrocketing natural gas prices.
The Citizens Utility Board, a non-profit watchdog group, attributed the increase to “skyrocketing natural gas prices” and “out-of-control utility spending.”
“Early predictions are that consumers could pay hundreds of dollars extra to heat their homes this winter,” the group said in a statement.
Peoples Gas prices for October 2020 were 24 cents per therm and now in October 2021, they are 72 cents per therm — a 198% increase.
Nicor Gas prices for October 2020 were 28 cents per therm and now in October 2021, they are 63 cents per therm — a 125% increase.
North Shore Gas prices for October 2020 were 35 cents per therm and now in October 2021, they are 67 cents per therm — a 91% increase.
The Citizens Utility Board said that the winter prices this year are expected to be at their highest level since the heating season of 2008-2009.
“High heating bills will be difficult for everyone, but could be painful and even disastrous for some families this winter,” CUB Executive Director David Kolata said.
“This could require action from state and federal officials to protect gas customers, but we also call on the utilities to do everything they can to keep their customers connected this winter. With the level of spending by some major utilities in the state, we have worried about an emergency like this for years,” Kolata said.
The Citizens Utility Board said the high prices are related, in part, to climate change.
“Prices have been elevated since last winter, in connection with extreme weather that has become more frequent as climate change intensifies. Record cold across the South last February froze gas wellheads and pipelines, limiting supply just as demand was shooting up,” the group said.
That sparked high market prices, contributing to the high utility supply rates all year.
According to the Energy Information Administration, other factors have kept prices elevated, including less gas exploration and well construction in recent years; increased demand as economies worldwide begin to recover from the pandemic; increased Liquid Natural Gas (LNG) exports to other parts of the world, such as Europe; increased use of gas for electricity generation in a hot summer of high air-conditioning use; and Hurricane Ida, which knocked more than 90 percent of gas production in the Gulf of Mexico offline in late August.
“Commodity prices are not the only reason we’re paying high bills. While utilities do not profit off the commodity price, they do make money off another part of the bill: delivery charges. And those have been rising rapidly in recent years due to aggressive infrastructure spending by the utilities,” the group said.
In 2013, the General Assembly allowed major gas utilities, including Peoples Gas, Nicor Gas and Ameren, to add the Qualified Infrastructure Plant (QIP) surcharge to consumer bills.
The QIP helps them bring in revenue more quickly and easily than through a traditional 11-month rate case.
With Peoples Gas, the surcharge is reportedly up to about $13 a month for the average household, or $156 a year.
In addition to the surcharge, Nicor has been pursuing multiple, record-high rate hikes in recent years and wants a $198.8 million increase to go into effect this winter, according to the Citizens Utility Board.
The group recommends residents get their HVAC inspected, weather-strip doors and caulk windows, and set their thermostat to 68 degrees during cold weather to reduce their gas bills.