InvestigatorsMatter for Mallory

Actions

BGE customers seeing a spike in heating bills

Cold weather and rising natural gas prices are to blame
Posted at 6:00 AM, Feb 22, 2022

BALTIMORE — Many utility customers have reported receiving unusually high bills in the last several months.

On its website, BGE is alerting customers to a rate adjustment that will increase bills, however, it’ll be reflected on next month’s bill. Recent increases are being driven by the weather and rising natural gas prices.

“I was astounded. I went into a little bit of a panic,” said Julea Seliavski, a college student who received a gas bill for more than $400. “I'm like in a really tough financial position and I already work four jobs, so now I have to work them more.”

In the meantime, she’s turned off her heat.

“It’s freezing in my house. If you came in you'd be shivering,” said Seliavski.

Dozens of people commented on WMAR-2 News Mallory Sofastaii’s Facebook post about recent spikes in utility bills.

Maryland People’s Counsel David Lapp said the culprit is the gas supply rate.

“[For BGE customers] it’s now $0.66 and last June it was $0.47,” said Lapp.

For nearly three years, prices were below $0.60 per therm until September 2021. These higher rates coupled with a cold spell led to shockingly high bills.

“January was 15 percent colder this year compared to last year,” said John Frain, the director of regulatory strategy for BGE.

BGE tries to plan ahead by purchasing gas when it's cheaper, but there’s only so much they can store.

“Prior to the winter heating season, the Energy Information Administration did indicate they expected high energy prices for all types of energy this winter. They expected a 30 percent increase for natural gas prices. It’s been less than that for BGE customers as a result of us purchasing gas in the summer when prices were lower,” Frain said.

There’s no cap on how much supply rates can increase, however, Frain said it’s expected to go down as demand for natural gas dwindles in the warmer months.

What will go up though are distribution charges.

Currently, the distribution rate is $0.69 per therm, which is higher than the gas supply rate of $0.66.

“What exactly are customers are paying for and how is it that it’s more than what natural gas costs?” asked Sofastaii.

“The distribution charge actually pays for all the gas infrastructure that is used to deliver energy and natural gas to customers in the BGE service territory, so there has been a lot of work to replace aging infrastructure in the natural gas system over the last several years,” said Frain.

The energy infrastructure investment plan also includes installing smart automation equipment and replacing outmoded technologies to improve the reliability and safety of energy delivery service to customers.

The multi-year plan rate increases were approved by the Maryland Public Service Commission.

Tax credits were used to offset the rate increase in 2021. Effective February 1, 2022, customers will begin to see a rate increase on their bills. And there will be a third rate increase in 2023.

BGE estimates customers will pay on average $3.28 more per month for electric and $2.40 per month for gas.

For customers looking to save money, BGE said the best way to cut back on your bill is to be more energy efficient. Your heating source also has a huge impact.

“If you are heating your house with electricity you are going to see much less of an increase,” said Lapp.

The Office of the People’s Counsel helps Marylanders better understand their bills or assists with filing a complaint. And while customers can’t avoid paying the delivery charge, they can shop around for lower supply rates.

Lapp cautions that customers considering switching to retail suppliers need to pay close attention to the terms of the contract. Is the rate variable or fixed? How long is the contract and is there a cancellation fee? While a company may be able to offer better rates now, it may only be a promotional rate.

Click here to view the PSC’s price comparison tool.

Save money on heating bills
Energy efficiency improvements can also help customers save 20 percent or more on winter heating bills. Below are some simple tips provided by BGE:

  • Keep it sealed. A poorly sealed house is costlier to keep warm. Caulk around doors, windows, and any openings for utility services. Using the locks on your windows helps make a tighter seal that is more resistant to drafts. If you have a fireplace, keep your damper closed when the fireplace is not in use.
  • Upgrade your insulation. Insulating your home can significantly reduce your heating costs, while also increasing the comfort of your home. Reducing air leaks – around floors, walls, ceilings, ducts, fireplaces, doors, windows, vents, and plumbing – could cut your home's average monthly energy bill by 10 percent.
  • Check ducts for air leaks. Look for joints that are no longer connected. Leaky ductwork can increase your energy bill significantly.
  • Warm up your system. Service your heating system before winter begins. A well-maintained system will last longer, operate more efficiently, and save you money. The potential for carbon monoxide exposure is possible if home heating equipment is not properly tested, serviced, and maintained.
  • Manage your thermostat. Keep thermostats set at a comfortable level. You can save about two percent on your heating bill for every degree you lower your thermostat. When you are asleep or out of the house, try turning your thermostat back 10 to 15 degrees for eight hours to save approximately 10 percent on your heating bill. Consider investing in a smart thermostat that can connect to your mobile devices, helping you stay on top of your energy usage.
  • Be prepared for cooler weather. Remove screens and air conditioners from windows and install storm windows.
  • Do not heat unused areas. Close vents in unused rooms and shut doors to unused rooms, closets, and basements.
  • Take advantage of the sun's heat. Open curtains on your south-facing windows during the day to allow sunlight to naturally heat your home and close them at night to reduce the chill from cold windows.
  • Shorter days and longer lights. Adjust outdoor lighting timers as the nights grow longer. Replace older incandescent bulbs with new energy efficient LED bulbs.
  • Monitor Usage Through BGE’s MyAccount, customers can track their energy use, set up high usage alerts, get tips on how to reduce energy costs, and learn which appliances use the most energy.

BGE bill relief and assistance programs
BGE has made new payment plans available, which can spread outstanding balance payments up to 24 months, with no money down and no interest charged.

Budget billing makes short-term fluctuations in monthly bills easier to handle by dividing annual energy costs evenly throughout the year.

Eligible customers can also request a 30-day payment due date extension.

Customers who are unable to afford their utility or heating bill, can apply for assistance through the Office of Home Energy Programs.