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January gas prices still way up–will we see some relief in 2023?

Natural gas supply prices dropped for about half of Illinois’ major gas utilities from December to January, but the prices are still at significantly high levels for the second consecutive winter. 

“We’re hoping that sometime in the new year we’ll see these price spikes ease for all customers, but the natural gas market is volatile,” said Jim Chilsen, CUB director of communications. “For now, your best weapon against these high prices is energy efficiency. It’s our second consecutive winter of painfully high prices, and it’s just another indicator that we urgently need to transition away from natural gas as an energy source.” 

Last winter was the most expensive cold season since 2008-09 for the 80 percent of Illinois households that heat with natural gas– many homes paid hundreds of dollars more for gas. The Energy Information Administration, the statistical arm of the U.S. Energy Department, predicts Midwest natural gas customers could pay on average about 29 percent more this winter. 

Gas utilities file new supply prices–called the Purchased Gas Adjustment (PGA)–each month with the Illinois Commerce Commission (ICC). There is some hopeful news: The largest gas utility in the state, Nicor Gas, continued a downward trend, with a price that is 19 percent lower than in December and 40 percent lower than in November. Ameren Illinois’ price was down about 10 percent from last month, and three other utilities are also charging lower prices than a month ago.

But Peoples Gas, North Shore Gas, MidAmerican and Consumers Gas all saw increases from December by a range of about 3 percent to 44 percent. Plus, unfortunately, seven out of nine major utilities are charging higher prices than last January, and all are charging prices that are higher by a whopping range of about 68 percent to 205 percent from just two years ago.

Below are the supply prices for January 2023, and how they compare with the prices from last year.

January Gas Prices 

Ameren Illinois–66.171 cents per therm (down about 6 percent from January 2022)
Consumers Gas–71.3405 cents per therm (up about 52 percent from January 2022)
Illinois Gas–59.44 cents per therm (up about 33 percent from January 2022)
Liberty Utilities–70.36 cents per therm (up about 19 percent from January 2022)
MidAmerican Energy–75.03 cents per therm (down about 23 percent from January 2022)
Mt. Carmel–89.13 cents per therm (up about 45 percent from January 2022)
Nicor Gas–69.00 cents per therm (up about 13 percent from January 2022)
North Shore Gas–66.01 cents per therm (down about 18 percent from January 2022)
Peoples Gas–57 cents per therm (up about 3 percent from January 2022)  

Note: Your utility is determined by where you live, so you cannot switch from one utility to another. 

Under Illinois law, gas utilities are not allowed to profit off supply prices—they pass those costs from gas producers and marketers onto customers with no markup. State regulators (and CUB) annually review the utilities’ gas-management procedures to ensure the companies did a reasonable job with their gas purchases, given market conditions, to hold down costs for consumers as much as possible.

A Review of Important Info about Gas Prices 

Gas supply price spikes are a recurring theme in the fossil fuel industry–there was a jump in prices in the winter of 2008-09, and for a period in 2014. The latest spike was first caused by extreme weather in February of 2021. Record cold in the southern United States for a time froze gas in wellheads and pipelines, limiting supply just as demand went up. Since then, the high prices have been propped up by other developments, including Hurricane Ida in the summer of 2021 and the Russian invasion of Ukraine this year, which have combined to cause ongoing pain for Illinois consumers. The elevated gas prices have also caused electricity prices to skyrocket–because gas is often used to generate electricity.

But the gas utilities hide behind supply and demand excuses. There’s more to this story in Illinois: Aggressive spending and/or rampant rate hikes by Peoples Gas, Nicor Gas and Ameren Illinois also have contributed to skyrocketing gas bills.

While utilities cannot profit from gas supply, they have increased and profited off another part of the bill: the Delivery section, what they charge to deliver gas to homes. CUB is working to eliminate the “Qualified Infrastructure Plant” surcharge from Ameren, Nicor and Peoples Gas bills (Take Action!) The charge, which was created by a law the Illinois General Assembly passed in 2013, allows gas utilities to rake in revenue more quickly, leading to rapidly rising heating bills. Read our Q&A on high natural gas bills. 

The last two expensive winters have just reinforced the need to move away from expensive, dirty natural gas as a heating source. CUB Executive Director David Kolata has said the recent efforts by the City of Chicago to move to cheaper and cleaner forms of heating than natural gas are a big step in the right direction. “Natural gas is simply unsustainable from an environmental and affordability perspective,” he said.

While CUB works for long-term reform, here are some actions consumers can take to get through this difficult winter: 

  • See if you qualify for energy assistance. The application process for the Low Income Home Energy Assistance Program (LIHEAP) has reopened through May 31, 2023, or until funds are exhausted. Households at or below 200 percent of the federal poverty level are eligible for LIHEAP funding. To apply or learn more, visit www.helpillinoisfamilies.com or call the Help Illinois Families Assistance Line at 1-833-711-0374.
  • Contact your utility. If you are having trouble affording your gas bills, it is vital that you contact your utility. Ask if you qualify for any energy assistance programs; see if you can set up a payment plan to give you a longer time to pay off your bills; and inquire about no or low-cost energy efficiency programs the company offers.
  • Beware of alternative supplier rip-offs. Alternative gas suppliers are impacted by the same market conditions that are causing utility prices to increase, so be careful about getting lured into bad deals. Be wary of low introductory rates that will skyrocket after a short period, and read the fine print for add-on fees that can raise the cost of the plan. If a deal seems too good to be true, there’s a good chance it is. Even in this market, it’s likely the utility is your best bet. (Note: Only consumers in Northern Illinois have gas choice.)
  • Practice energy efficiency at home. For tips and information about helpful energy efficiency programs offered by your utility, visit CUB’s Clean Energy page. Also visit CUBHelpCenter.com for more information about energy assistance, tips on cutting your bills and your rights to avoid disconnection. Read our tips here and here. A summary:
    • Set your thermostat to 68 degrees when you are home and awake. When you’re asleep or away, you can turn it 7-10 degrees lower. NEVER go below 55 degrees, because you could freeze your pipes.
    • Reduce the drafts. Weatherize your windows and doors, and pinpoint other drafts in your home. Your hardware store has materials to seal those leaks.
    • Don’t overwork your heating system. Close blinds as an extra layer of protection against icy night winds. But let the sunlight through during the day to help heat your home. Clear radiators, registers, air returns and baseboards of obstructions. Dust, carpet and furniture can block the heat and leave a room chilly.
    • Clean or replace filters for a forced-air heating system. A dirty or non-functioning filter does nothing but drain money from your wallet. Check it every month—and clean or replace it if it’s dirty.