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Californians are used to high prices when it comes to energy, but this is too much. 

According to the latest figures from the U.S. Energy Information Administration (EIA), natural gas prices in California are rising faster than electricity prices. Businesses are already feeling the pain of increasing supply chain costs cutting into profits. 

So why are natural gas prices rising? It’s due to the state’s increasingly strict regulations on the use of natural gas especially in new build residential and commercial properties. At the same time demand is continuing to increase as we head into winter since natural gas is the primary energy source for heating across the state.

The good news is that there are ways to lower your energy costs despite the rising prices. The first step is to become better informed about natural gas pricing and usage in California. Doing this will help you identify when it may be more cost-effective to switch to other energy sources or explore comprehensive onsite energy systems accounting for both electrical and thermal loads.

In addition to researching natural gas alternatives and developing a comprehensive energy plan, there are also various financial incentives offered through utilities or on a federal level like the Investment Tax Credit, which was recently extended as part of the Inflation Reduction Act, that can help offset the costs of transition. 

It’s important to consider all the associated costs and benefits when making decisions regarding your energy use. Today, incentives help make business cases even stronger. California has also mandated that utilities transition to 100% renewable electricity sources by 2045. This means there are additional incentives available for early adopters who make the switch sooner rather than later. 

When considering energy sources, it’s important to factor in natural gas pricing. Natural gas prices have been rising faster than electricity prices in California, which may influence the decision to switch from one source of energy to another. It’s also important to consider the environmental impacts associated with various energy sources. Natural gas is a cleaner-burning fuel than other fossil fuels, but it still contributes to carbon emissions. Renewable energy sources such as solar and wind have zero emissions, making them a more sustainable choice for the environment.

In general, switching to renewable energy is becoming increasingly cost-effective. As costs continue to decline, it may make more financial sense for California businesses to invest in renewable energy sources, such as solar and wind. Investing in these clean energy sources could help to reduce the state’s reliance on natural gas and other fossil fuels, ultimately leading to a more sustainable energy future. 

Ultimately, California consumers will have to weigh the pros and cons of different energy sources before making a decision about which is best for them. However, it is clear that natural gas prices are on the rise, making renewable energy sources a more attractive and potentially cost-effective option for those looking to reduce their environmental impact.

On a personal level, I just received a notification from SoCal Gas that my natural gas prices for December 2022 are 61.7% higher than December 2021 (see screenshot below) which is tough to swallow.

California Natural Gas Prices on the Rise

For those considering implementing an onsite energy system. We recommend exploring options as soon as possible with the coming changes to Net Energy Metering (NEM). You can learn more about that here.

Californians have a lot to consider when it comes to energy prices. On the one hand, natural gas prices are on the rise and show no signs of stopping. This could lead many people to switch to renewable sources of energy, which have long-term savings and sustainability benefits. Alternatively, some consumers may decide that the increased cost of natural gas is worth it for the convenience it provides. In any case, it will be important for California business leaders to stay informed about changes in energy prices so they can make the best decision possible for their businesses.

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