More evidence of the repercussions of high energy costs are being felt in mounting electricity costs. Record numbers of utility companies across America are requesting price increases. Unless you have installed a solar electricity generation system on your home and business, you are facing steep price increases, as high as 30%!
Southern California Edison announced July 21 it was seeking an average rate increase of 25 percent with high use customers set for in excess of 30%
Pacific Gas & Electric, in its June 10 media advisory: “Starting in October 2008, these factors are expected to increase electricity costs to PG&E customers by approximately $482 million, resulting in a roughly 4.5 percent rate increase, to be collected over a 15 month period through December 2009.”
Department of Water & Power, LA: April 9 announced power rate increases of 2.9% in May 2008; 2.9% on July 1, 2008, and 2.7% on July 1, 2009.
Consumers from California to New York are facing rate increases of as much as 30 percent, reports the Christian Science Monitor, July 25, in its report "Fuel cost now driving up electric bills."
"In the last two months, 20 to 30 utilities started requesting to have their rates increased," says Tyler Hodge, an electricity analyst at the Energy Information Administration (EIA) in Washington. "With the rise in fuel costs, other utilities will follow suit pretty soon."
The report goes on: The fuel cost that has risen the most so far is natural gas, up about 40 percent in the past year. Last year at this time, the spot price of natural gas was $6 per million BTUs. Thursday morning, the price was $9.85 per million BTUs. In early July it reached as high as $13.31.
The rising price of natural gas is one of the reasons why Southern California Edison, the largest utility in California, recently warned customers it would be requesting a sharp increase in rates. Mid to high use residential customers can expect a rate hike in excess of 30 percent. For their overall system of 4.8 million customers, the average rate increase will be 25 percent.
"On August 1, we normally make a filing to the California Public Utilities Commission that will highlight what we feel our fuel and power costs will be," says Gil Alexander, a spokesman for the utility. "Last week we issued an early warning because of spiking natural gas prices."
The giant utility uses natural gas for 60 percent of the energy that it generates or buys since it is one of the cleanest fuels. "The price has doubled over the last twelve months, and we are quite vulnerable," says Mr. Alexander.
But, coal has also been climbing. In the past 18 months, the spot price of coal has doubled, says Jim Owen of the Edison Electric Institute, which represents the investor-owned utilities in Washington.
Here in California, not all of the rate increases are in the double digit range. Pacific Gas & Electric sees a smaller 4.5 percent increase.
