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Demonize natural gas; pay more for electricity

The headline news today is that PG&E has approval to raise residential rates 9% on March 1st.  Small businesses get to pay 10% more and large businesses get to pay even more bringing the average increase across the grid to 12.69% in "a move to generate revenue as the utility grapples with ballooning global natural gas prices."  The so-called consumer advocate group TURN reminds us that this comes on top of a 9% increase at the beginning of this year.  How did we get here?

Let's see.  First, you get politicians from the White House to the state legislature on down to local city councils to demonize natural gas use.  That introduces a low level of long-term uncertainty into the market.  The Feds then try to burden the industry with illusory costs (until a judge tells them to stop it) and they use ESG metrics to laden producers and investors with more uncertainty.  That reduces funding to oil and gas producers who, in turn, cut capital expenditures even though they have long-lead times for new drilling.  Then you wait for overseas demand to spike due to European weather and Russian saber-rattling.  Voila, natural gas prices bounce off their 20+ year lows and our electricity prices go up for legitmate reasons that even the CPUC buys into.  Meanwhile the European Union puts aside its green ambitions and decides to say OK to more natural gas for themselves.

So pay-up people.

PG&E up 9 percent

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20 responses to “Demonize natural gas; pay more for electricity”

  1. Paloma Ave

    Why haven’t voters figured out that once politicians get involved everything turns to $hit?

  2. Joe

    For completeness on the federal judge’s ruling, from today’s WSJ:
    A federal judge on Friday nailed the Biden Administration for the ruse of attempting to use an inflated “social cost” for carbon emissions.
    Enter the Biden Administration, which last February adopted an Obama -era estimate of $51 per ton cost of CO2.
    The Administration has used this inflated social cost to impose more onerous fuel-economy and energy efficiency standards. Agencies are also using it to conduct environmental impact statements under the National Environmental Policy Act for an Alaska liquefied natural gas project and mineral leases.
    Federal Judge James Cain ruled Friday that the Biden team’s departure from administrative norms was arbitrary and capricious. He also held the Administration likely violated the separation of powers by imposing new obligations of “vast ‘economic and political significance’” on private parties and states. Its “estimates artificially increase the cost estimates of lease sales, which in effect, reduces the number of parcels being leased,” the judge explained.

  3. Spurinna

    Time to start using our wood-burning pot bellied stoves.
    Oh, wait- PG&E’s already burned up all the trees.

  4. Pythagoras

    Thank you Joe Biden & the Democrats
    Savings profit gone
    Stock market profit gone
    Kids trust (no progress)
    Air quality in Burlingame (worst ever)
    I feel bad for the lower income groups who this effects most of all.
    Hate to say we told you so.

  5. Joe

    Here’s a few more read-em-and-weep statistics from Robert Bryce, host of the Power Hungry Podcast, writing in the WSJ today:
    On Feb. 25, the day after Russia invaded Ukraine, the Energy Information Administration reported that the all-sector price of electricity in California jumped by 9.8% last year to 19.76 cents per kilowatt-hour. Residential prices increased even more, jumping 11.7% to an average of 22.85 cents per kilowatt-hour. California residential users are now paying about 66% more for electricity than homeowners in the rest of the U.S., who pay an average of 13.72 cents per kilowatt-hour.
    California’s rates are rising far faster than those in the rest of the country. Last year, California’s all-sector electricity prices increased 1.7 times as fast as the rest of the U.S., and residential prices grew 2.7 times as fast as in the rest of the country.
    On Feb. 10, the California Public Utilities Commission unanimously approved a scheme that would add more than 25 gigawatts of renewables and 15 gigawatts of batteries to the state’s grid by 2032 at an estimated cost of $49.3 billion. Also last month, the California Independent System Operator released a draft plan to upgrade the state’s transmission grid at a cost of $30.5 billion. The combined cost of those two schemes is about $80 billion. Dividing that sum among 39 million residents works out to about $2,050 for every Californian.
    Remember, these are only estimates. With rampant inflation hitting everything from zinc and lithium to nickel and aluminum, the final cost could be far higher.
    _____________________________
    It seems like a good time to make residential rooftop solar less financially attractive, right??? One of my new Tesla-owner buddies told me last night that he got a $750 check from Newsom to help with his purchase…….

  6. Paloma Ave

    Just received my PG&E bill. Tier 1 is .28240 a kwh and Tier 2 is .35476 a kwh.

  7. Joe

    From today’s WSJ:
    Ukraine War Drives Up Cost of Wind, Solar Power
    ‘Greenflation’ problems are particularly acute in U.S., where tariffs targeting China helped increase project costs, led to delays before Russian attack
    Russia’s invasion of Ukraine is further driving up the price of renewable-energy projects, which were already facing supply-chain strains and raw-materials increases before the war.
    The new pressures, which are hitting two years after the pandemic created bottlenecks for wind and solar developers, are adding to delays for completing many projects.
    A third of U.S. utility-scale solar capacity scheduled for completion in the fourth quarter of 2021 was delayed by at least a quarter and 13% of the projects planned to complete this year have been delayed for a year or canceled, according to a new report from Wood Mackenzie and the Solar Energy Industries Association.
    A report by LevelTen Energy, a renewable-energy marketplace, found that prices for long-term contracts for wind and solar-power purchases, which are used to finance new projects, rose substantially last year in almost every competitive power market in the U.S. Fourth-quarter prices jumped by 12.1% for solar and 19.2% for wind compared with the prior year, according to the company’s indexes.

  8. Cassandra

    Drill for oil.
    Supply our homeland and Europe.

  9. Joe

    Today’s solar news is really quite laughable. From the WSJ article on the Commerce Dept. probing whether Chinese solar panels are being funneled through other Asian countries to avoid the tariffs:
    California Gov. Gavin Newsom told the department in a letter Wednesday that the investigation has caused the delay of numerous new solar and battery storage projects expected to come online through 2024.
    The risk of such tariffs has halted some exports to the U.S. and caused delays or cancellations by project developers, according to the Solar Energy Industries Association, an industry trade group. The group cut its solar installation forecasts for 2022 and 2023 by 46%, or 24 gigawatts of capacity, more than the industry installed in all of 2021.
    The delays could pose serious challenges in California, where utilities have been racing to procure new renewable energy and battery storage to help offset the closure of several gas-fired power plants, as well as a nuclear plant that provides nearly 10% of the electricity generated in the state. Already, the state has been strained to keep the lights on in the summer as a severe drought crimps hydroelectric production throughout the West and wildfires threaten transmission capacity.
    Mr. Newsom said in his letter to the Commerce Department that the investigation has delayed at least 4,350 megawatts of new solar and storage projects, including more than 400 megawatts of new capacity that was expected to come online this year.
    ——————–
    Whoops.

  10. Joe

    You would be forgiven for thinking this piece in the Chron is about dams, water and fish. While it is, note the hidden timebomb he mentions just once…
    REDDING — After decades of negotiation, the largest dam-removal project in U.S. history is expected to begin in California’s far north next year.
    The first of four aging dams on the Klamath River, the 250-mile waterway that originates in southern Oregon’s towering Cascades and empties along the rugged Northern California coast, is on track to come down in fall 2023. Two others nearby and one across the state line will follow.
    ….
    “This is the end of the road for any migrating fish,” said Mark Bransom, chief executive officer at the Klamath River Renewal Corp., the nonprofit cooperative created to manage the dam removal, as he looked down at the dams from the small plane.
    Bransom helped organize this week’s flight with the aim of getting a final aerial view of the hydroelectric facilities before their demolition.
    Owned by power company PacifiCorp, a subsidiary of billionaire Warren Buffett’s Berkshire Hathaway, the dams have long needed major upgrades, including fish ladders, which are believed to cost more than the dams’ worth as hydroelectric assets.
    https://www.sfchronicle.com/bayarea/article/California-dam-removal-17187703.php
    Can you say “brown out”….or is “black out” easier to pronounce?

  11. resident

    It’s a good thing we have so much nuclear power in California with lots more coming on line.

  12. Paloma Ave

    After all of these years about the bitching and complaining about nuclear power, all of a sudden democrats are asking for Diablo Canyon to stay open?
    Who would have thunk it?

  13. Joe

    Here’s another letter to the editor in the WSJ with more interesting factoids:
    Your editorial “America’s Summer of Rolling Blackouts” (May 28) identifies absurdities arising from attempts to bend the laws of physics to the demands of progressive ideology. How fatuous those demands are is illustrated by U.S. Energy Information Administration data pegging the “capacity factor” of utility-scale wind generation for 2021 at 34.6%.
    In English, that means a U.S. wind farm can be relied on to generate its designed electricity output a bit less than two-and-a-half days in any given week—with the caveat that you don’t know which days. The EIA gives utility-scale solar panels a weaker capacity factor of 24.6%. Without continuously available fossil or nuclear capacity, the systems we’re told we must use for our electricity generation will guarantee nothing except the collapse of the grid.
    Our leaders are intent on abandoning the world’s most reliable and affordable energy system in favor of something far more costly that doesn’t work very well.
    David Hoopman
    Monona, Wis.

  14. resident

    The Obamas are putting in 2,500 gallons worth of propane storage tanks on Nantucket. Whaaaa? No wonder they didn’t buy in Burlingame.

  15. Peter Garrison

    Germany just fired up their coal plants due to Putin’s restrictions on natural gas.

  16. Handle Bard

    They are on Martha’s Vineyard, not Nantucket, but let’s go with it for this:
    There once was a man from Nantucket
    Where sea level rise is more than a bucket
    With oil companies he once did dual
    But now at home, it is all fossil fuel

  17. Joe

    Can anyone else foresee the day when an authoritarian Burlingame city council mandates that we all enroll in this sort of program with PCE and PG&E? Saw the blurb in the Daily Post, but here is an on-line link:
    Power Company Seizes Control Of Thermostats In Colorado During Heatwave
    Around 22,000 households in Colorado lost the ability to control their thermostats after the power company seized control of them during a heatwave.
    After temperatures soared past 90 degrees, residents were left confused when they tried to adjust their air conditioning and found locked controls displaying a message that said “energy emergency.”
    Xcel confirmed to local news station Denver7 that “22,000 customers who had signed up for the Colorado AC Rewards program were locked out of their smart thermostats for hours on Tuesday.”
    Completely losing control over the temperature of your own home is presumably one of the many benefits of the green energy ‘Great Reset’ Americans will be forced to endure.
    This story is yet another example of how smart meters will pave the way for energy rationing.
    https://www.nationandstate.com/2022/09/02/power-company-seizes-control-of-thermostats-in-colorado-during-heatwave/

  18. Paloma Ave

    And it is claimed Republicans want to take your rights away?!
    It is the California democRATS who want to dictate how you can live your life!

  19. MBGA

    It’s kind of clever and portends how it will play out in many ways. The 22,000 customers that saw that they lost a bit of control of their energy usage actually opted into that plan to get a discount on their energy rates. Many probably would do it again if offered the chance. If you don’t have the bucks you choose that plan. I’m curious what sort of pricing incentive was offered and what percent of customers that 22,000 represented.
    But someday it won’t be dollars. It will be social credit. If you have social credit your use of energy will be a bit different than the MAGA guy down the street who the regime declares an enemy of democracy.
    And it won’t be just be about cooling your house. A different class of protein for dinner, a different level of monitored safety and ability to protect his domain. An adjusted access to information and to speech participation. This is the dream of the current regime in charge in DC and in California. And most people in the bay area vote for them.

  20. Spurinna

    There will be levels of informant-benefits as well? As with the Stasi in East Berlin?
    Vote the Democrats out.

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