Natural Gas Bills Increase Due to Soaring Methane Prices

Oregon’s three natural gas utilities all raised billing rates this week. Oregon customers of NW Natural, Cascade Gas, and Avista Utilities will feel the effects this winter. Last week, regulators approved the rate increases which go into effect on November 1.

*NW Natural customers will only see a 14% rate increase starting November 1, 2022. More information about this bill increase below.

The primary reason for these latest increases is that wholesale natural gas prices have increased significantly. There are a variety of reasons for this increase in the cost of gas. Extreme weather has increased the demand for natural gas for heating and for electricity generation. Liquified natural gas has made natural gas a global commodity. The war in Ukraine has disrupted the natural gas and oil market, which has caused the price of fossil fuels to rise worldwide.

Natural gas companies are beginning to purchase a small portion of expensive biomethane derived from landfills and livestock operations. Currently, this is a tiny fraction of the gas that is sold by Oregon’s gas utilities. However, it contributes to the rate increase because it is significantly more costly than traditional methane from fossil fuels.

Regulators approved two rate increases for NW Natural in October. Combined, they total a 25% increase. This includes a 16% increase in the rising cost of gas. The remainder was approved for NW Natural to use for safety repairs, system upgrades, and costs of delivering gas to customers.

Thanks to an agreement between CUB and NW Natural, the rollout of these rate hikes will be staggered. NW Natural will raise rates 14% in November and then again in the spring. This will help households avoid shockingly high heating bills they cannot afford. The goal is to keep more families connected and avoid shutoffs this heating season.

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