SACRAMENTO, Calif. (CN) — The California Public Utilities Commission is set to vote Nov. 2 on proposed rate increases that will affect Pacific Gas & Electric customers across the state.
The proposed rate hikes are part of a routine that happens every four years. Investor-owned utilities like PG&E that are regulated by the CPUC submit a four-year budget as part of their General Rate Case. That budget includes any plans the utility has for furthering the safe and reliable delivery of its services.
For this four-year period — 2023 to 2026 — PG&E pointed to inflation and major investments to undergrounding electric lines as a reason to increase rates.
PG&E asked for $15.4 billion for 2023. The CPUC responded with a Proposed Decision, setting 2023 costs at $13.8 billion; and an Alternative Proposed Decision, with costs at $13.3 billion.
The vote initially was set for before the start of this year, with PG&E’s intention for the new rates to become effective Jan. 1, 2023. However, the vote was delayed. When that occurs, the difference between approved 2023 rates and actual rates will be reconciled over a time that’s decided during the upcoming proceeding, a PG&E spokesperson said.
Commissioners will vote Nov. 2 on the Proposed and Alternative Proposed decisions. Either would raise current rates. The new rate will become effective Jan. 1, 2024.
“As the two proposed decisions demonstrate, this (General Rate Case) is complicated and complex,” said Carla Peterman, PG&E corporation executive vice president, corporate affairs and chief sustainability officer, in a statement last month. “While the proposed decisions support some important programs, they fall short in funding critical wildfire mitigation, gas safety and reliability programs that benefit our customers and hometowns.”
Under the Proposed Decision, an average electric and gas PG&E customer would see their monthly bill rise by $31.13. An average electric-only average customer would see their bill climb by $22.37 a month under the Proposed Decision, and by $8.76 if they received only natural gas.
The Proposed Decision, if approved, would be a 12.5% increase.
The Alternative Proposed Decision would bump an average electric and natural gas customer’s monthly bill by $25.25. It calls for an increase of $18.59 for electric-only customers, and $6.66 for natural gas-only.
The alternative decision would be a 9.9% increase.
“PG&E is proposing a monthly rate increase to consumers of nearly $40 — just under $500 annually,” state Senator Brian Dahle, a Republican from Bieber, said in a September statement. “That’s a significant sum for growing families, seniors, and everyday Californians.
“According to PG&E, the main reason for the rate increase is to underground electrical lines, thereby increasing safety,” Dahle added. “The CPUC questioned these efforts and has suggested other alternatives.”
Dahle’s district comprises a massive swath of Northeast California, touching the Oregon border to the north, the Nevada border to the east, and extending as far south as Placerville. It’s largely rural and has been home to some of the most recent major wildfires.
The 2021 Caldor Fire in El Dorado, Alpine and Amador counties burned almost 222,000 acres and at one point threatened the city of South Lake Tahoe. The 2022 Mosquito Fire in Placer and El Dorado counties burned almost 77,000 acres.
The 2018 Camp Fire led to over 80 deaths and burned over 153,000 acres. It destroyed the towns of Paradise and Concow. In 2020, PG&E pleaded guilty to 84 counts of manslaughter and one count of recklessly starting the Camp Fire. A judge fined the utility $3.5 million.
PG&E in its funding request wanted revenue to underground 2,000 miles of electric line and install a covered conductor — used to mitigate wildfire ignitions — on 320 miles.
The Proposed Decision calls for undergrounding 200 miles and installing the covered conductor on 1,800 miles. The Alterative Proposed Decision would lead to undergrounding 973 miles and covered conductor on 1,027 miles.
AARP has been communicating with PG&E and its members for about two years over the proposed rate increases. It’s concerned over how double-digit rate increases will affect people’s ability to pay as housing, food and health care costs climb, said Michael Murray, director of business integration with AARP California.
“We know there’s great interest from our members,” Murray said. “We’re concerned.”
Murray said the CPUC heard those concerns earlier this month. He argued that covered conductors are a better option than undergrounding lines, as it’s more economical.
He’s pleased that the CPUC incorporated some of AARP’s recommendations into the Alternative Proposed Decision, which his organization supports. However, he doesn’t want to see one increase regularly followed by another as the years pass.
“We definitely plan to show up,” he said of the Nov. 2 meeting.
Nevada County Supervisor Ed Scofield is no stranger to PG&E. A few years ago the utility began cutting trees in Nevada City in an attempt to reduce fire risk, angering residents and leading one man to climb a tree and stay in it for days in protest.
Scofield is also familiar with talk of the utility undergrounding electrical lines.
“We’ve seen very, very little undergrounding going on up here,” Scofield said, asking moments later: “What damage is it going to cause to do the undergrounding?”
According to Scofield, PG&E faces no California Environmental Quality Act restrictions like others who must seek government approval for moving earth and construction projects. His county’s planning department has reached out to PG&E, though it’s received no cooperation.
Nevada County officials have complained about PG&E to the CPUC, Scofield said. However, concerning the utility’s proposed higher rates, he’s heard little about it from his constituents.
“Once those increases start hitting, I’m sure we’re going to hear more about it,” he said.
The Nov. 2 CPUC meeting is set for 11 a.m. at the Warren-Alquist State Energy Building in Sacramento. Public comment will be heard at the meeting.
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