Special meeting to focus on recent skyrocketing natural gas prices in CA
SAN FRANCISCO (KGO) -- The California Public Utilities Commission and the California Energy Commission will hold a special joint meeting Tuesday to address the recent spike in natural gas prices.
On Monday, Governor Gavin Newsom sent a letter to Washington D.C. asking for a federal investigation.
"I think he has a good case for investigating what happened," said UC Berkeley's Severin Borenstein.
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Borenstein is faculty director of the Energy Institute at Haas. He was referring to California Governor Gavin Newsom's call, in the form of a letter, for a federal investigation into natural gas price spikes in California and other West Coast states. Newsom sent the letter to the Federal Energy Regulatory Commission.
"There's some precedent that during the California electricity crisis in 2000/2001 one of the problems was that a pipeline had been disrupted from an explosion, but another problem was the pipeline company was actually restricting the flow on it in order to raise prices even higher," said Borenstein.
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Since late November of last year, there have been huge increases in the cost of natural gas. While it is agreed amongst all sides that cold weather played a role here, the governor says, "but those known factors cannot explain the extent and longevity of the price spike."
Borenstein says that spike was around 80% in much of Northern California and 300% in parts of Southern California. He also said that despite there being less pipeline capacity coming into California and storage facilities not being what they were, there should still be questions here.
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"It could be simply supply and demand but it might not be; and it's really important to be on top of that and to make sure that anyone thinking of manipulating the market recognizes that there is likely to be an investigation," said Borenstein.
Californians will soon see some relief on their utility bills from the annual California Climate Credit.
As for Tuesday's meeting, officials will explore this price spike and possible protections for ratepayers going forward.
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