A Peoples Gas crew installs a 12-inch main in Albany Park in 2019. Peoples Gas is undergoing a massive underground overhaul of its residential natural gas pipe system. | Sun-Times file
Illinois leaders should explain where price increases really come from before Illinoisans turn their frustrations on the green power sector.
No sooner did the Illinois Legislature pass an important bill this fall to boost clean energy than another worry cropped up: soaring natural gas prices.
Elected officials will have to do all they can to make sure players in the industry don’t jack up prices on consumers, as Russia is doing to Europe right now and as Enron did to California two decades ago.
Illinois leaders’ should get the word out that now is a good time to insulate homes and find other ways to conserve energy. And they should get out their megaphones to explain where those price hikes are coming from before the frustrated people of Illinois sour on the whole idea of a green power sector.
Nicor, which provides natural gas to businesses and to heat homes in the suburbs, estimates gas prices could go up by 48% this winter. In the city, which is served by Peoples Gas, prices might go up even more. Those predictions refer to the cost of gas itself, which is only part of ratepayers’ bills. Fixed costs, which for many homeowners are the biggest share of the bill, won’t be affected. But even so, the costs could be catastrophic for many people if it is a frigid winter. Natural gas prices in the United States already have climbed rapidly this month, reaching a 13-year high last week.
Already, 30% of the people in Chicago can’t afford to pay their gas bills, according to the Citizens Utility Board. If prices soar, more people will cut back on medicines to pay utility bills, or they will unsafely keep their homes too cold, or they will try to warm their homes in dangerous ways, such as by using their ovens. Existing programs to help people pay their gas bills, including those listed at ChiCookilRentHelp.org, should be expanded if the winter is indeed severe and prices do go as high as expected.
Higher natural gas prices also translate into higher electricity prices, because gas is used to generate some of the electricity Illinoisans use.
Last winter in Texas, when nearly 4.5 million homes and businesses went without power for weeks because the state for years had ignored calls to protect its fossil-fuel-burning power grid against severe storms, demagoguing politicians tried to blame the disaster on Texas’ nascent renewable energy infrastructure.
We shouldn’t let that dishonest game play in Illinois.
Ironically, what happened in Texas sent natural prices soaring even beyond that state’s borders because the natural gas market is regionalized. And the costs of the Texas freeze still are being passed along to ratepayers in the Chicago area. Yes, Texas messed with Illinois.
Other factors driving up costs include increased demand after the worst of the pandemic because the fossil fuel industry — similar to other supply chain issues — cannot ramp up easily after cutting back due to reduced demand; more liquefied gas is being exported to other nations; gas used to generate electricity for air conditioning in last summer’s heat left supplies low, and Hurricane Ida temporarily knocked out much of the gas production offline in August near the Gulf of Mexico.
Also, Nicor is asking for its third rate hike in four years.
We’ve been heading in this direction for years. When gas prices were low, utilities raised other costs without it being apparent immediately. Those higher costs won’t go away even as gas prices rise.
When people can’t pay their gas bills, power companies write it off as bad debt and other ratepayers pick up the extra tab, currently more than $4 per customer a month. The fixed fees on customer bills can run to more than $30, according to Illinois PIRG, and a fee that allows gas utilities to spend heavily on replacing pipelines and other projects averages about $13. People can easily get hit with total charges of almost $50 before they burn a therm of gas.
With rising prices, the siren song of “drill, baby, drill” — revert back to fossil fuel — could begin to resonate in Illinois.
But burning natural gas sends heat-trapping carbon dioxide into the atmosphere, and gas pumping and pipelines leak methane, a more potent greenhouse gas.
In just three weeks, on Oct. 31, the United Nations’ 26th Climate Change Conference will convene. And in a month, the traditional heating season in Illinois will begin. This is no time to backtrack on our state’s commitment to clean energy.
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