Something is up, and unfortunately, it may be a higher utility bill for Oregon gas customers. In a time when communities are already bracing for Congressional Republicans’ new energy tax hike, NW Natural Gas Company is trying to raise costs on Oregonians as well. Even worse, they aim to raise our gas bills to boost their shareholders’ profits and invest in expensive fuels under the guise of decarbonization, rather than providing lower-income customers with the option to install an energy-efficient heat pump!
Oregon is lucky to have a tireless ratepayer advocate in the Citizens Utility Board, which intervenes in every rate case on behalf of consumer protection and customer affordability. Climate Solutions does not intervene in every rate case, but when we think there is an opportunity to protect customers and the climate, we enter the ring. This is one of those cases!
The issue? NW Natural (NWN), our largest gas utility, has raised rates by 40% since 2021, including a 5% increase in November 2024. They returned to their regulator, the Oregon Public Utility Commission (PUC), just months after their last rate increase, with their hands open, requesting another 6.8% increase to customer bills. In this era of rising energy bills for customers, NW Natural even sought to raise its “return on equity” for its shareholders from 9.4% to 10.4% (this is the guaranteed rate of return shareholders get for investments in gas infrastructure, which sets monopoly utilities apart from other kinds of private investments).
To raise our rates again, NW Natural needed to get permission from the PUC, the state regulator that is responsible for making decisions related to Oregon’s six investor-owned monopoly utilities. At the PUC, over the past four years, the investor-owned utilities have been seeking more and more rate increases, resulting in energy costs for you rising nearly 50%. Fortunately, a settlement has been reached between the gas utility and other parties, which will limit how much NW Natural can charge customers. The PUC must first approve the agreement before it becomes final. We’ll be following up with details later this summer.
Aside from the consumer bearing the burden of cost, there is a bigger concern here, and you guessed it– it’s gas. NWN delivers “natural” gas, which primarily consists of methane, a highly potent pollutant that is damaging our climate and our health. Unfortunately, the gas company’s decarbonization plans have primarily focused on trying to pipe expensive “renewable natural gas” (a.k.a. biomethane) and hydrogen into homes, which continue to expand fossil fuel infrastructure at the customer’s expense, benefiting NW Natural alone. Unlike electrification and energy efficiency investments, these alternative fuels are extremely costly and, if adopted at the scale necessary to serve all of NW Natural’s customers, would drive rates through the roof, all while continuing to pollute people’s homes.
By law, the company is required to reduce its climate pollution over time, and it has a lot of options for achieving this. Besides investing in tried and true methods of reducing emissions like energy efficiency, gas companies can also pursue more innovative options by investing in pollution-free solutions like Thermal Energy Networks, or allowing customers to access affordable electric alternatives like heat pumps, induction stoves, and heat pump water heaters. It’s critical that these electric appliances are affordable for lower-income Oregonians, especially as President Trump and Republican-led Congress phases out incentives and other energy assistance. Otherwise, Oregonians with the least means face being left behind, paying escalating costs for an aging gas system.
Here at Climate Solutions, we have joined a coalition of environmental and community-based organizations, represented by lawyers at the Green Energy Institute at Lewis & Clark Law School, to push for equitable climate progress and protect customers from unnecessary rate increases. We are asking the PUC to require NW Natural to pursue tangible and equitable solutions to cut its pollution. One key outcome we are still fighting for: giving low-income gas customers in Oregon a choice when their old gas furnace breaks. You should be able to install a heat pump instead of just replacing it with a new furnace and staying hooked to the expensive gas system for decades more.
This is an equitable and affordable measure that also provides community care, as many low-income customers can’t afford to replace their furnace when it breaks down, much less upgrade to install both heating and air conditioning. Installing a heat pump is the most energy-efficient and comfortable way to get heat and AC, and we are advocating to make sure every Oregonian has access to these affordable, clean energy solutions.
Stay tuned for more updates on how you can help us protect energy affordability and lower pollution!
