Newsom signs executive order to drive down electricity costs

SACRAMENTO, Calif. (CN) — California Governor Gavin Newsom on Wednesday issued an executive order intended to curb higher electricity bills.

The move comes about a week before the state’s air resources board is set to amend its low carbon fuel standard — a change Newsom’s political opponents claim will lead to higher prices at the pump.

California regulatory agencies have taken the brunt of public outcry over high utility prices for months. The state’s Public Utilities Commission regularly hears angry, even threatening, comments related to electricity prices.

Newsom’s executive order seeks to assuage those concerns.

“We’re taking action to address rising electricity costs and save consumers money on their bills,” Newsom said in a statement. “California is proving that we can address affordability concerns as we continue our world-leading efforts to combat the climate crisis."

Newsom in his order points to some reasons for the Golden State’s higher electricity costs. Those include programs added over the years, like a subsidy offered through a net energy metering program for rooftop solar.

Additionally, the governor notes electricity rate increases are tied to investments needed to reduce wildfire risks and heighten the electrical grid’s safety and reliability.

It’s those investments, and the costs they bring, that many people complain about at Public Utilities Commission meetings.

“We’re not going to stop and we’re coming for you, so be warned,” said one person in an Oct. 17 phone call to the commission.

Newsom made a series of requests to the independent utilities commission, and directed state agencies, in his executive order.

He asked the utilities commission to find underperforming programs and return unused program funds to customers through credits on their bills. He also ordered the air resources board to work with the utilities commission to maximize the state’s climate credit — a credit that appears biannually on many people’s utility bills.

Additionally, Newsom asked the utilities commission to examine ratepayer-supported programs and regulation costs, and recommend methods of saving customers money. He also asks that it work toward securing federal dollars that could lower people’s bills.

The governor also ordered the Office of Energy Infrastructure Safety, and asked the utilities commission, to examine wildfire safety practices, ensuring that investments are cost effective.

“We fully support his commitment to tackling these vital issues and acknowledge the importance of this initiative,” said Terrie Prosper, director of strategic communications with the commission, in a statement. “In response to the executive order, we are committed to fulfilling the governor’s requests, which are consistent with priorities of the CPUC.”

Mark Toney, executive director of The Utility Reform Network, in a statement called the executive order an important first step in addressing the state’s affordability crisis that families, small businesses and others face.

“TURN looks forward to working with the governor’s staff on affordability strategies not in the [executive order] that will save ratepayers billions in spending, including setting limits on utility overspending, requiring least cost solutions to wildfire safety, and public financing options to reduce the cost of wildfire safety capital investments,” Toney said.

Republicans in the Legislature expressed skepticism at the future success of Newsom’s directive.

State Senator Marie Alvarado-Gil, a Jackson Republican, said in a statement she appreciated that Newsom acknowledged the issue. However, she added that he and Democrats must take a hard look at the policies that brought them to this point.

The senator also drew a line from electricity policies to next week’s vote by the air resources board.

“Next week, [air resource board member] millionaires are poised to vote on a policy that could raise gas prices by as much as 65 cents per gallon, yet the public is largely unaware,” she added. “Who will be held accountable?”

Assemblymember Joe Patterson, a Rocklin Republican, said in a phone interview that any savings stemming from Newsom’s order will pale when compared to the higher costs people face from his other policies. He pointed to some transmission lines taking 10 years to reach completion, a cost eventually levied on ratepayers.

Patterson also saw a political reason for Newsom’s order. In the polls he’s examined, the cost of living is the top issue.

“I think he knows this and is trying to do something about it ahead of [Election Day],” Patterson said.