Winter Bill Warning


Pay Close Attention to Your Natural Gas Bill and Your Usage This Winter

This winter, expect to see much higher natural gas prices in Maryland and across the nation, relative to prior recent winter periods. The current rates for the “commodity” portion of the bill—the price of the gas itself, excluding the utility’s cost for delivery—were almost twice as high as they were last winter and almost three times what they were the winter before that. These rates change from month to month, but they will probably stay high, and you should be prepared for very high heating bills this winter.

The Public Service Commission regulates how the utilities buy natural gas and the cost of gas delivery, but it does not regulate wholesale natural gas prices. The utilities pass through to us in our bills the wholesale gas commodity cost. While gas delivery rates generally are increasing as well, commodity prices, not delivery rates, are the primary reason for the recent and projected increases in natural gas prices.

Natural gas commodity price spikes can mostly be attributed to U.S. national and international gas supply and demand issues. During the pandemic, demand for natural gas dropped, leaving commodity prices relatively flat, as gas supply and demand adjusted to a lower level of consumption. As we begin to recover from the pandemic, U.S. domestic natural gas demand is returning to pre-pandemic levels, but gas production is lagging relative to the rebound in demand. To compound these U.S. domestic supply and demand issues, liquefied natural gas (LNG exports from the U.S. to other parts of the world, such as Europe, are increasing. The exports put significant additional upward pressure on domestic U.S. natural gas commodity prices.

Changes in natural gas commodity prices can also affect your electricity bill. Gas price increases affect wholesale electric supply rates because gas is an input to electric power generation serving Maryland. As a result, high and volatile natural gas commodity prices put upward pressure on retail electric rates. The rates for utility electricity commodity service—known as standard offer service or SOS—are increasing on October 1st. The SOS prices will be between 6% and 26% higher than last winter.

If you have chosen a retail supplier for electricity or natural gas, pay close attention to what the price is and consider locking in a rate now. If you are on a variable price contract with a retail supplier, there are few limits on the price that a company can charge. For electricity, anything over $.09887 per kilowatt hour likely will be higher than the price charged by your utility beginning October 1, 2022. For natural gas, anything over $0.9741 per therm for BGE, or $0.8672 per therm for Washington Gas, is likely higher than the price charged by your utility. For more information on retail supplier charges, click here.

If you’re struggling to pay your bills, call your utility and find out what energy assistance is available, and to see if you can sign up for a plan that will allow you to pay off your bills over a longer time period.

Consider looking into energy-efficiency programs to help control cost and upgrade your home. All utility companies provide free to low-cost energy audits of the home, under the EmPower Maryland Program (funded by all customers). These audits provide detailed information and specific recommendations to reduce energy consumption.

Some tips to reduce energy use in your home:

Check your furnace air filter. If the filter is dirty, the furnace works harder and consumes more electric. Depending on the home, filters will need to be replaced more often.

Hot water heaters build up dirt inside the tank. Have your water heater checked to determine how often it should be cleaned. It is a simple process, but have a professional show you how the first time. Then set up a schedule to clean out the tank. The hot water heater will last longer and use less electric or natural gas.

If you have a heat pump, check to make sure nothing is blocking the outside unit air vents/fan vents (leaves, limbs, bushes).

On a windy day, move your hand around all windows, doors, and wall plug/switches on exterior walls. If you feel air, think of money going in and out. There are various low-cost insulation products.

Is one room or wall much colder during the winter? There may be no insulation, or voids of insulation, in that wall. A full energy audit can provide the exact answer using heat-imaging equipment (which will also pinpoint water leaks in the walls).

Wrap hot water pipes with foam insulation to reduce heat loss. These come in various sizes. Hardware store associates will be able to help.