Natural gas is cheap, so why is your bill so high?

WASHINGTON, Pennsylvania—Janet Stechly, a retired schoolteacher, and her husband, a retired coal miner, pore over every monthly expense. One of the most confounding is the monthly natural gas bill for their small townhouse in southwestern Pennsylvania.

Their March bill from Columbia Gas of Pennsylvania totaled $95.17, but only $13.99 of that was for the gas itself. The other $81.18 covered delivery ($40.68) and a series of hard-to-decipher items including a “customer charge” ($20.15), “pass-through charges” ($13.37), and a “weather normalization adjustment” ($6.60) that was included because warm weather meant the Stechlys had used less gas than expected.

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“We’ve got enough going on out here,” Janet Stechly, 77, said. “And I know who ends up paying for it: me, on a fixed income.”

Gas Is the Cheap Part

As this family’s experience illustrates, increasing gas bills have nothing to do with the price of gas itself. Nationwide, the American Gas Association reports, actual fuel itself accounts for only 31% of the average bill. It is even lower for the Stechlys, who live in the most-drilled county in Pennsylvania. Washington County has 2,148 unconventional gas wells, more than any other county in the state. All told, they produced 1.15 trillion cubic feet of gas last year.

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Like other utilities, Columbia Gas of Pennsylvania, which serves 445,000 customers in 26 counties, makes nothing on the gas itself; it buys the fuel and passes on the costs to ratepayers.

“Natural gas itself is completely unregulated. That’s the cheap part of it,” said Dale Nesbitt, president of ArrowHead Economics and a Stanford-trained economist who has modeled energy markets since 1974. “The pipe is regulated. That’s where you’re getting screwed. That’s where the fees are fixed.”

Columbia Gas’s delivery rates were climbing before any data center broke ground in Pennsylvania, as the state utilities commission approved a $55.6 million increase that took effect Jan. 1. Company spokesman Lee Gierczynski said the increase pays for pipeline replacement and safety work under a long-term infrastructure plan. “There is no data center-related investment that’s factored into our current rates,” he said.

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The commodity’s share of an average Columbia Gas bill fell from 54% to 21% between 2006 and 2021, according to data compiled by the Pittsburgh Post-Gazette. Over those same 15 years, Columbia Gas roughly doubled its base rate charges, in part to fund infrastructure programs that included $2.5 billion in distribution spending since 2007.

“Gas could drop to zero and the bill would still go up, because of how utilities work,” Gasilov said. “They recover all their costs from all their consumers. That’s the whole model.”

Data Center Pressures

More plants are coming, so those costs can be expected to continue rising.Patrick Henderson, vice president of government affairs at the Marcellus Shale Coalition, said about 15 new and converted gas plants were built in Pennsylvania from 2012 to 2019 before development stalled. Then this year, the announcement that a coal plant in Homer City would be converted into the largest gas plant in the country by 2029 marked the beginning of a new wave of construction to support data centers.

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These and other expected new power plants will feed electricity to PJM, the regional grid operator for Pennsylvania and a dozen other states. For 2028-29, data centers are expected to draw about 38% of the grid’s juice, said Joseph Bowring, president of Monitoring Analytics, the grid’s independent market monitor. The grid operator expects 32 gigawatts of new peak demand by 2030, about 30 of them from data centers.

“Whether that demand actually materializes or not, people are already paying for it,” Gasilov, the analyst, said. “The bill for the forecast arrives before you can tell whether the forecast is right.”

Barbara Kates-Garnick, a professor of practice in energy policy at Tufts University’s Fletcher School, said there are limits to what consumers will have to pay for the power plant buildout. Infrastructure dedicated to serving data centers generally will not be picked up by common ratepayers. But there are shared investments in the system, such as pipes for increased gas transmission, that will get baked into rate increases, Kates-Garnick said.

Darryl Lawrence, Pennsylvania’s consumer advocate whose office represents ratepayers, agreed that the cost concerns for consumers reside in these shared upgrades. “A dedicated lateral to a plant is what the developer pays for,” he said. “A compressor station the utility says improves reliability for everyone, everyone pays for that.”

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Local Resistance

The proposals for more data centers in western Pennsylvania have drawn a mixed reaction from residents and local politicians. Politicians such as Washington County Commissioners Chairman Nick Sherman are advocating for the facilities to bring investment, jobs, and tax revenue to the region.

Sherman called the Zediker Station site in South Strabane “primed for development” when a 1,400-acre tract there was marketed to data center developers last fall. He estimated a project could bring 300 to 400 union construction jobs.

Locals who oppose data centers are resigned to trying to dampen the harmful effects through zoning regulations. But local power stops short of a ban, which only the state can impose.

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Supervisor Jeff Bull told RealClearInvestigations that the ordinances can protect a neighborhood and nothing more. “What we can control is what gets built next to somebody’s house, and the environmental impact of that,” he said.

While state lawmakers push legislation to temporarily pause the construction of new data centers, none of these local and statewide measures deal with the rising costs that likely will be found on the gas bills of residents like the Stechlys.

“The energy issues are decided at the PUC in complex hearings involving many experts and consultants under a long-standing legal framework that is difficult for the individual to understand and to fight,” Tufts’ Kates-Garnick said.

Gasilov, the analyst, says local residents have very little say in these important decisions over rates at PUC meetings. “Almost nobody shows up to those,” he said.

Tech Titans Pledge To Pay

Whether all these announced gas plants and data center campuses get built is another issue.

“In the merchant power business, about five percent of the stuff gets built,” said Nesbitt of Arrowhead Economics, who was part of many of those projects. “Pipeline expansions, generation, all of it. Five percent.”

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An obvious solution to rising rates for consumers is for the data center developers to provide their own power. Nesbitt said some developers in Texas are “building strictly off-grid power to avoid regulation,” although how this will interface with existing transmission capacity to ratepayers won’t be clear until the construction is finished.

In March, Alphabet, Meta, Microsoft, and other data center companies pledged at the White House to protect consumers from price increases tied to their energy needs. But Bowring of Monitoring Analytics said the pledge cannot be kept under grid operators’ current rules. “There’s only one way to do what hyperscalers agree is the right thing to do, and that is to run a separate auction for their own power,” he said.

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Asked whether most people she knows understand their gas bill and why it may soon go up again, she replied: “I was a schoolteacher. So, of course I know how much they don’t know. But I do think a lot of us retired folks know it’s going to be worse than we expect.”

This article was originally published by RealClearInvestigations and made available via RealClearWire.

(*) Full article: https://www.wnd.com/2026/09/natural-gas-is-cheap-so-why-is-your/