Summary: Texans face skyrocketing home energy bills as the state exports more natural gas than ever. [Excertps}
What’s driving electricity and gas bills higher? Is the price of natural gas the only cause?
[Excerpts]
The cost of electricity in Texas is tightly tied to the price of natural gas, which has more than doubled since late February.
“I am worried people are going to be shocked,” said John Ballenger, vice president at Texas retail electric provider Champion Energy. “Realizing this is 50 or 60 or 70% higher than what they had paid before, I’m just not sure it’s real to people yet. If it’s not, it will be very, very soon when the bills hit this summer.”
What’s driving electricity and gas bills higher?
The elevated utility bills have primarily been driven by the price of natural gas, which has shot up more than 200% since late February when Russia, a top gas-producing country, invaded Ukraine and upended the world’s energy market.
Since then, Texas, the leading natural gas-producing state in the U.S., has not been able to keep offering its own residents cheap energy.
“People are lining up around the world to get our product,” said Todd Staples, president of the Texas Oil and Gas Association.
But demand for natural gas has also been growing at home as more people and businesses continue to flock to Texas. A hotter-than-normal spring and early summer also have driven demand for power to record-high levels. Most Texas power plants run on natural gas.
Is the price of natural gas the only cause?
While they agree the price of natural gas is the primary driver behind Texas utility bills, energy experts say there are other factors at play.
The state’s main power grid operator, the Electric Reliability Council of Texas, has been managing the grid more cautiously since last February, when millions of people were without power for days in subfreezing temperatures after a combination of cold weather across the state and skyrocketing demand for energy shut down power plants as well as the natural gas facilities that supply them with fuel. Hundreds of people died.
Public Utility Commission chair Peter Lake, appointed by Gov. Greg Abbott after the winter storm to lead the agency in charge of ERCOT, has said the grid operator is no longer prioritizing providing Texans cheap power. Instead, Lake said, its main focus is the grid’s reliability, especially during extreme hot or cold weather. But that has a price.
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