Spiking Natural Gas Prices To Hit Home For Peoples Gas Customers

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When Peoples Gas was awarded a record $303 million rate hike in November 2023, the utility said the increase in delivery charges would be offset by projected lower gas prices, limiting the impact on its 894,000 Chicago customers. But a recent spike in gas prices may deliver a one-two punch to customers this spring, bringing home the longer-term impact of the rate increase that the utility downplayed when the gas costs were lower.

Peoples Gas is charging customers 52.79 cents per therm for gas in April, up about 30% from March and 104% year-over-year, according to the Citizens Utility Board, making it the second-highest gas price Peoples has charged during April in a decade.

⁘Peoples Gas misled its customers,⁘ CUB Executive Director Sarah Moskowitz said in a news release Wednesday. ⁘It was absurd for the utility to claim that its rate hike wouldn⁘t lead to higher bills. The supply price spike took effect on April Fools⁘ Day, but this is no joke for so many Chicago families who are struggling to afford their heating bills. We hope it⁘s a warm spring.⁘

Residential gas bills include both supply and distribution charges. While the utilities don⁘t make any money on the supply end ⁘ the natural gas itself ⁘ they are responsible for procuring it as efficiently as possible, to hold down the cost paid by customers.

Gas prices have been rising this year after the U.S. endured the coldest January in 37 years, increasing demand and draining underground storage supplies, according to analysts. Last month, the U.S. Energy Information Administration projected that higher consumption and lower inventories will lead to higher natural gas prices through 2026.

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