The doubling and in some cases quadrupling of Southern Californians’ natural gas bills in recent months stemmed from rapid price spikes in the so-called spot market, a real-time wholesale market for the fuel. The lack of transparency in California’s spot market for gasoline played a similarly major role in the pummeling California drivers took at the pump last year.
The secrecy surrounding transactions in both of these markets keeps the public in the dark about who is making a fortune off their pain. Transparency would not only reveal the profiteers but could also discourage future gouging.
Southern California Gas Co., the monopoly that provides gas in Southern California, usually draws down its stored inventory of gas in the winter instead of buying it during the colder months, when it is most expensive. This year, however, rather than tap its inventory, the utility chose to buy massive quantities of gas on the spot market — where someone made a fortune off natural gas prices that were 10 times higher than usual.
