Oregon’s largest gas utility is asking to raise customer rates by about 3% or less starting Nov. 1. That’s less than the rate hike it first proposed, and comes after energy affordability advocates worked to cut the company’s profit margins by more than half.
NW Natural, which serves more than 2.5 million people in Oregon and Southwest Washington, originally proposed raising residential rates by about 7%. The company said the reason it needed to increase rates was because of inflation, to pay for system upgrades, to replace equipment at a storage facility and a pipeline, and to put toward a profit increase.
NW Natural Gas crews arrive at NW 10th Avenue and NW Davis Street in Portland in February 2021, responding to reported gas leak.
Kristyna Wentz-Graff
But utility watchdog group Oregon Citizens’ Utility Board, along with other nonprofit groups focused on energy affordability and climate justice, determined that about two-thirds of the company’s $59.4 million increase request was going toward profits.
“We really shouldn’t be raising our energy bills, especially our gas bills, for just the benefit of shareholders,” Oregon CUB’s communications and outreach director Charlotte Shuff said. “So, what we were able to take out this year was just a pretty straightforward profit margin increase. NW Natural asked for a 1% increase in their profits and instead they’re getting a 0.1% increase, which is about standard for what utilities are earning in Oregon.”
Oregon CUB along with other general rate case intervenors helped reach an agreement through the general rate case process, which can take a year to go through.
Other proposed NW Natural expenses were also cut, Shuff said, including membership dues the utility intended to pay and other investments the company planned to make.
If approved by the Oregon Public Utilities Commission, NW Natural residential customers could see their energy rates increase by about $2 a month rather than the originally proposed $5.55 a month, starting Nov. 1 – though that’s an imprecise estimate. The exact rate increase will be determined, in part, by the market price of natural gas before that date.
NW Natural spokesperson David Roy said the company works throughout the year to manage costs and limit rate impacts on customers.
“An important indication of this work is that our customers currently pay on average less for natural gas than they did 20 years ago,” he said in an emailed statement.
Energy rates continue to increase across Oregon’s largest gas and electric utilities, with some companies increasing rates by more than 50% over the last five years. Those increases have been impacting customers, some of which have had to make difficult decisions of whether to pay energy bills or pay for groceries or medications.
NW Natural’s request comes at the heels of an approved November increase for residential customers of 4.7%, or an average of $3.74 more a month on a typical gas bill.
According to Oregon CUB, NW Natural disconnected 7,200 households for nonpayment in 2023.
That number increased by 2,000 customers in 2024, or the equivalent of 23,000 Oregonians, Shuff said.
“It’s really clear that people are struggling,” Shuff said. “Four hundred of those disconnections are known low-income households who are already receiving assistance and nearly 3,000 of those disconnections lasted longer than a week.”
Overall, about 70,000 households were disconnected from for-profit utilities for nonpayment last year, Shuff said.
“Thousands of those are again, known low-income households who are already receiving discounts on their energy bills,” she said. “It’s known that people are struggling, and yet there’s just not really the systems in place to stop that.”
But earlier this year, Oregon lawmakers passed the Fairness & Affordability in Residential Energy Act, or FAIR Energy Act, which will limit high yearly rate hikes from utilities to once every three years starting in 2027.
The law will also require companies to provide an annual report on upcoming rate increases, what it will be for and how it will impact their customers.
It will also change when rates increase occur.
For gas utilities like NW Natural, new gas rates take effect Nov 1.
Energy affordability advocates have said rate increases before winter hurts customers, as energy usage is high to keep homes warm, and are directly related to disconnections.
Now, the law will require new rates to be implemented after the winter months.