NW Natural Asks for Another Bill Increase Amid Skyrocketing Rates

Posted on March 5, 2025 by Cassie Allen
Tags, Energy, General Interest

This year, NW Natural is asking for a 7% increase in billing rates for its household gas customers. The gas utility filed this request with regulators just two months after receiving a rate increase on November 1, 2024. This increase could mean NW Natural bills going up nearly 50% for households since 2021.

The company is asking for more money primarily for replacing aging equipment, seismic upgrades, rising costs from inflation, and increasing its allowable profits. CUB is strongly opposed to the request for more profits, particularly as rates have skyrocketed over the past few years. We will continue to review the other costs in this case to ensure they are good uses of customer dollars.

Customer Impacts

If approved, this would mean a $5.55/month increase for an average household across the year. Winter gas bills would have a larger impact, with new winter bills averaging at about $138 for single-family homes and $136 for multifamily homes. New rates could go into effect November 1, 2025.

We also anticipate NW Natural filing for another rate change later this year related to the cost of gas. This filing happens every year as the market continues to change and impact fuel costs. While this is a normal adjustment, it is uncertain if the change will have a significant impact on customers in combination with the already requested 7% increase.

What NW Natural is Asking For

This year, NW Natural is asking for a fairly limited amount in its requested increase. The request totals $59.4 million ($41 million going to residential customers) from investments and profit increases.

Major cost drivers include:

Inflation: Rising costs for equipment, staffing, etc.
Infrastructure: Replacing equipment at the Mist gas storage facility and the North Coast Feeder pipeline.
System Upgrades: Seismic upgrades for resource centers and modernizing IT systems
Profits: Increasing allowable profit margins to 10.4% (currently 9.4%)

CUB is reviewing all of the costs to ensure they are reasonable for customers to pay. We are particularly concerned with the request to increase profit margins. This 1% increase would cost customers millions of dollars each year.

Control Costs, Not Increase Profits

If this increase goes into effect in 2025, NW Natural bills will have increased 50% in five years.

Customers are struggling with their energy bills, including gas. Last year, NW Natural disconnected more than 9,100 households that could not afford to pay their bills. That’s nearly 2,000 more households than in 2023, with only modest growth in the total number of customers.

Regulators Need to Stay Consistent on Profit Cuts

Last year, regulators made it clear that if utilities cannot manage their costs, it will come out of their profits. After Portland General Electric raised billing rates 18% in January 2024, it filed for an additional rate increase weeks later. PGE’s request to increase rates for 2025 also included an ask for higher profits. To manage costs for PGE customers, the Oregon Public Utility Commission ordered the utility to lower its profits in a decisive ruling.

NW Natural is ignoring regulators’ clear message—if a utility cannot control its spending, their profits must be cut to control costs for customers.

CUB will be pushing back hard to cut profits in favor of affordability for Oregonians. We need our utility regulators to stay consistent with all utilities and reduce profits to help customers avoid skyrocketing energy bills.

NW Natural Is Working Against Customers’ Interests

This year, NW Natural is making it clear that it is working against customers’ interests in favor of its shareholders. The state’s largest gas utility is working in multiple venues to oppose policies that would protect customers. CUB is fighting back, advocating for the interests of people, not profits.

In the Courts: Appeals to Continue Charging Customers for Expanding the Gas System

Last year, customers won big in NW Natural’s request to increase billing rates. This year, NW Natural is taking to the courts in an attempt to overturn two rulings aimed at protecting customers.

Regulators ruled that existing customers will no longer pay to expand NW Natural’s business through a subsidy called a “line extension allowance.” This subsidy is often paid to building developers, encouraging new homes to be built with gas. The Oregon Public Utility Commission sided with CUB after a nearly five-year fight to protect households from this unnecessary cost.

Commissioners also ruled that the gas utility must remove $13.7 million from customer rates to prevent overspending. While CUB was investigating NW Natural’s expansion subsidy, we found that the utility massively overspent on expanding its system. The most expensive connection NW Natural covered was $86,553 for a single home in 2021 when the cap was $2,875.

Read More: Customers Win Big in NW Natural Rate Case (CUB Blog)

NW Natural is going to the courts in an attempt to reverse both of these decisions made to protect customers’ interests and bills. Regulators were clear that it was not in the best interest of Oregonians to subsidize expanding the gas system. And made it abundantly clear that overspending on this subsidy should not stay on customers’ bills.

This appeal is a last-ditch effort to continue the model of constant growth in both the gas system and NW Natural’s profits. CUB continues to be involved with this case and will keep representing the interests of Oregonians.

In the Legislature: Fighting Energy Affordability Bills

NW Natural is back in Salem this year with its team of lobbyists and allies at the NW Gas Association. This year, they’re targeting the FAIR Energy Act (HB 3179), which aims to address energy affordability for Oregonians.

The FAIR Energy Act (HB 3179) will address Oregon’s affordability crisis by empowering state regulators to set energy billing rates at the lowest possible level so families can better avoid big increases in energy bills. The bill also will move any increases out of winter, when energy usage is highest, and limit big rate increases to once every 18 months. Utilities will also have more flexibility to use low-cost financing for important investments in the energy grid to keep customer impacts low. In addition to these protections, the bill will increase transparency so that consumers know what they are paying for and what to expect from any changes in energy bills.

This bill came at the request of CUB and is supported by a wide range of community-based organizations, including Verde, Community Energy Project, and Oregon Just Transition Alliance. So far, the only opposition is coming from gas companies and their allies.

But NW Natural and Oregon’s other gas companies have come out in opposition, complaining that waiting an additional six months between big rate increases “creates massive uncertainty” for utilities. The utility is also attempting to create a panic that if consumer protections are added, investors will leave Oregon. This fearmongering is in direct opposition to customers’ best interests because it creates safeguards to protect Oregonians from overly eager utilities who want to increase profits for investors.

Customers Can Weigh In on NW Natural’s Rate Increase March 18

On Tuesday, March 18, the public will have an opportunity to weigh in on NW Natural’s request to raise rates by 7% in 2025 at a public hearing.

If you are interested in receiving more information about this hearing and help creating your testimony, sign up to speak using this form or email CUB’s Community Organizer, David, at .(JavaScript must be enabled to view this email address).

Stay Up to Date on Oregon Utility Issues

CUB will continue to advocate for people in Oregon on major utility issues. Sign up for the CUB email list for the latest updates, action alerts, and news on policies that affect the utilities your home relies on.

Donate to CUB

To keep up with CUB, like us on Facebook and follow us on Twitter!