Opposition to CPUC electric bill changes mounts
Thursday, March 28, the California Public Utilities Commission (CPUC)
issued a proposed decision on how large investor-owned utilities may
bill for electricity in California. A hearing for this proposed decision
is scheduled for the CPUC’s May 9 business meeting. If approved, the new
rate structure will go into effect in late 2025 and early 2026.
But in the past month, strong and vocal opposition has been expressed
more frequently and publicly. The largest — a coalition of several
hundred groups, including Center for Biological Diversity, Environmental
Justice Coalition for Water, Western Center on Law and Poverty, Howard
Jarvis Taxpayers Association and UCAN (Utility Consumers’ Action
Network) — have protested and written a letter to the governor and
legislative leaders in both the state Senate and Assembly. Members of
California’s Congressional delegation have independently supported the
coalition.
The CPUC’s administrative judge’s tentative decision would change
utility bills in two ways. One will be a flat rate for the cost of the
electric grid, that is, the building and maintaining of the industry’s
infrastructure, such as power lines, applied to all customer bills.
Secondly will be a separate charge for actual usage. By separating the
fixed costs from the usage charges, the electricity rate is expected to
decline 5 to 7 cents, according to the CPUC. This will not change the
utilities’ ability to impose time-of-day charges.
This change in the rate structure is the result of Assembly Bill 205,
which became law June 30, 2022. It gave the CPUC until July 1, 2024, to
develop a new rate structure.
“Stop the Utility Tax” — the massive coalition of opposition — makes two
arguments against its approval. First, the coalition objects to how the
legislative provision was initially approved. It was a trailer bill,
part of the fiscal year 2022-23 budget, which was “… passed in three
days without any public hearings or discussion. The people of California
deserve a voice in any major policy change with such wide-ranging
consequences.”
Secondly, they argue that it will have negative effects on a significant
number of consumers. Medium and low-income individuals and families,
living in apartments, condominiums or small houses, will see their bills
increase. Only consumers with large electricity usage will benefit from
the rate reductions, according to “Stop the Utility Tax.”
The coalition supports AB 1999, which would repeal the provisions of AB
- It would limit the fixed rate to $5 per month for individuals who
are enrolled in the California Alternate Rates for Energy program. For
other electricity users, the fixed monthly rate would be limited to $10.
Both could increase due to changes in the consumer price index.
However, the Legislature has taken no action on AB 1999 and as of April
28, no hearing has been scheduled.
But “Stop the Utility Tax” argues that the $24.15 monthly fixed rate the
administrative law judge recommended in the proposed decision is more
than double the national average.
“A utility tax of $24 a month would unfairly raise utility bills, even
for anyone with a small energy footprint, disproportionately harming
most people who live in an apartment or small home. This would be
devastating to renters and households that are already struggling,” said
Richard Skaff, executive director, Designing Accessible Communities,
said in opposition to the tentative decision, and continued.
“People with disabilities and vulnerable seniors will be especially
impacted. Over four million Californians live with a disability, often
struggling to make ends meet. Lower-income households with family
members who have a disability are already wrestling with major
affordability challenges and are often living just above the subsidy
cutoff line,” Skaff added.
If approved, the CPUC estimates that a customer who powers their home
and vehicle with electricity would save an average of $28 to $44 monthly
compared to under today’s billing structure.
The new rate provisions still maintain both current income-based
discounts for electricity customers.
The CPUC stressed that the proposed decision does not include any income
verification requirements. The existing programs like CARE and FERA
already establish income eligibility through enrollment in programs like
MediCal and SNAP or through a voluntary income self-attestation process
followed by audits, according to the news release.
On March 25, 18 members of California’s Congressional delegation sent a
letter to the CPUC about this pending decision. “We believe that a
policy change of this magnitude requires thorough vetting and analysis.
We urge the CPUC to ensure that any proposal it ultimately pursues
neither inadvertently and disproportionately increases energy costs for
low- and middle-income California families, nor slows down our efforts
to address climate change through energy efficiency, conservation, or
distributed energy resources.”
In the conclusion of their letter, the coalition wrote, “A Utility Tax
does not fix that underlying problem because it just rearranges who pays
what — harming millions of working-class people in the process. The true
solution to stabilizing the high cost of electricity is to reduce our
overdependence on long distance power lines through greater conservation
and local clean energy.”
The CPUC meeting is at 11 a.m., Thursday, May 9. The proceedings may be
watched online at http://www.adminmonitor.com/ca/cpuc.
