Sierra Club says new electric rates will cost majority more

State's 5-tiered system moves to 2 two tiers by Jan. 1, 2019

A San Francisco-based conservation group said a new electricity rate plan passed Friday by the California Public Utilities Commission will raise rates on majority of customers and make the air dirtier.

The approval by the CPUC in San Francisco will transition the state's five-tiered system to two tiers by January 1, 2019 with a 25% difference separating the two tiers, according to the CPUC.

CPUC officials said the new rate structure will mean more customers will be paying for the electricity they use rather than higher income customers subsidizing lower income customers.

The California Legislature froze lower tier rates in 2001 and the five tiers increasingly departed from a pay for what you use structure, according to a statement by CPUC president Michael Picker. This "imposed greater inequities on large-family households that were pushed into higher tiers in hot climate zones," Picker's statement added.

But Sierra Club officials said now customers using twice the average amount of electricity will pay less and everyone else will pay more.

"After slipping in hundreds of last minute changes, this outcome is hardly surprising," Director of the Sierra Club's My Generation Campaign Evan Gillespie said in a statement. "The majority of residents will face higher bills and dirtier air as a result."

"By moving this vote to a federal holiday, and then slipping in an updated proposed decision less than two days before, the Commission has shown that the public's interest is not the priority here," Gillespie said in the statement.

A spokesperson for the CPUC did not immediately respond to a call or email requesting a comment on whether rates for a majority of customers would increase.

Keith Burbank, Bay City News


1 person likes this
Posted by solar user
a resident of Del Prado
on Jul 6, 2015 at 8:24 am

Can someone explain how this will affect solar users?

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Posted by Oliver Heaviside
a resident of Val Vista
on Jul 6, 2015 at 8:54 am

Oliver Heaviside is a registered user.

It's likely many solar (PV) owners will see an increase, unless they are net-zero. Most aren't. Your electric bill is a combination of the actual cost to make the electricity and the cost to maintain all the lines and poles and such. That cost is fairly constant, i.e. it doesn't vary as a function of electricity usage. So, when we use less electricity, there needs to be a bump in the rates to cover this fixed cost.

PGE pays solar home owners far more for the electricity the home owners generate than they do for any other source of electricity - typically 20 to 30 cents per kWh, versus ten cents or less for most other forms of power. So with more home owner created solar, their costs of electricity are going up.

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Posted by Damon
a resident of Foothill Knolls
on Jul 6, 2015 at 9:05 am

@Oliver Heaviside: "PGE pays solar home owners far more for the electricity the home owners generate than they do for any other source of electricity - typically 20 to 30 cents per kWh, versus ten cents or less for most other forms of power."

20 to 30 cents per kWh is an outrageously high price to pay for electricity. How did that ever come about? PG&E is going to have to change that as more and more homeowners go to solar.

4 people like this
Posted by AnotherParent
a resident of Country Fair
on Jul 6, 2015 at 12:17 pm

AnotherParent is a registered user.

Oliver Heaviside - Please tell us where you are getting the 20-30 cents per KWH number?

This is from PGE's website:
"On June 9, 2011, the California Public Utilities Commission (CPUC) approved the Net Surplus Compensation rate based on current market prices, which is between $0.03 to $0.04 cents per kilowatt-hour (kWh). Payments to PG&E customers began on October 21, 2011."
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