CA-Electric utilities set to impose "progressive" billing, the more you make the more you pay

[Anti Federalist]

CA-Electric utilities set to impose "progressive" billing, the more you make the more you pay

California power companies roll out fixed-rate bill proposal

https://ktla.com/news/local-news/california-power-companies-roll-out-fixed-rate-bill-proposal/

by: Marc Sternfield

Posted: Apr 14, 2023 / 05:02 PM PDT

Updated: Apr 16, 2023 / 03:04 PM PDT

Editor’s Note: this article has been updated to include additional billing details.

If you earn more, you pay more.

That’s the basic idea behind sweeping changes proposed by California’s three largest power companies that will impact your electricity bill.

Southern California Edison, Pacific Gas & Electric, and San Diego Gas & Electric submitted a joint proposal to the state’s Public Utilities Commission last week that outlines the new rate structure. It follows last year’s passage of Assembly Bill 205 which requires a fixed rate and generally simpler power bills.

Under the proposal, households will see a fixed rate covering basic electricity services and the utility company’s operating costs on a scale based on their household income.

Households with annual income from $28,000 – $69,000 would pay $20 a month in Edison territory, $34 a month in SDG&E territory and $30 a month in PG&E territory.

Households earning from $69,000 – $180,000 would pay $51 a month in Edison and PG&E territories and $73 a month in SDG&E territory.

Those with incomes above $180,000 would pay $85 a month in Edison territory, $128 a month in SDG&E territory and $92 a month in PG&E territory.

The utilities say customers should expect to also see lower costs for their kilowatt-hour usage.

“That law was intended to lower the amount that residential customers pay … while increasing transparency with bills,” Southern California Edison spokesperson Kathleen Dunleavy told KTLA on Friday. “This will provide relief to millions of customers.”

SCE says approximately 1.2 million of its lower-income customers will see their bills drop by 16%-21%. Overall, rates will decrease by about 33% per kilowatt hour for all residential customers, the utility says.

“We have listened to and heard from our customers that fundamental change is needed to provide bill relief,” SDG&E CEO Caroline Winn said in a statement. “When we were putting together the reform proposal, front and center in our mind were customers who live paycheck to paycheck, who struggle to pay for essentials such as energy, housing and food.”

State law requires the CPUC to adopt a new rate structure by July 1, 2024. Southern California Edison says the earliest customers would see the updated bills is 2025.

 

[Dr.3D]

How are they going to know the income of each household?

 

[Anti Federalist]

How are they going to know the income of each household?

Pipe down, climate denier.

 

[Occam's Banana]

Decoupling billing rates from usage rates ... gee, what could go wrong?

 

[CaptUSA]

If anyone knew what went into the sausage making of utility rates, you wouldn't be surprised by this. The amount of cross-subsidization in rates would make your head spin. Usually, it's between rate classes like residential, commercial and industrial, but there have always been carve-outs for low income residential rates. Further, there are other subsidization programs that assist low-income customers.

Believe this, the regulators that approve utility rates view them as a tax. The electrical grid is the largest machine in the world and the rates you pay for accessing that machine are just a funding mechanism to keep that machine running.

How are they going to know the income of each household?

Easy - like they do it today. They just assume you make above $180,000/year unless you tell voluntarily them differently. See? It's voluntary!!

Decoupling billing rates from usage rates ... gee, what could go wrong?

The article doesn't really give enough information about what is being proposed here. Is it just the transmission and distribution rate or does it extend to the generation rates as well?? There also appears to be a volumetric rate in addition to the fixed service rate - just 33%/kWh lower. (I'm not sure how that's more simple). There's no way all residential bills would be capped at $128.

There is a case to be made for decoupling generation and T&D rates and charging T&D based on the max kW demand rather than the volumetric kWh. Think of your electric service like a water hose. Your monthly T&D cost would be based on the size of hose needed to fulfill your needs, whereas the generation (or supply) side of your bill would be based on the amount of water going through the hose. If you can spread out your usage to avoid the bigger hose, you can keep your infrastructure costs down and lower your T&D bill regardless of how much energy you end up consuming. Many states have adopted this method for delivery costs without much of an issue.

Really, though, these things all have to be "approved" by the regulating agencies in each state. If you ever want to see what regulatory capture really looks like, look no further than the utility industry.

 

[Anti Federalist]

The article doesn't really give enough information about what is being proposed here. Is it just the transmission and distribution rate or does it extend to the generation rates as well?? There also appears to be a volumetric rate in addition to the fixed service rate - just 33%/kWh lower. (I'm not sure how that's more simple). There's no way all residential bills would be capped at $128.

My understanding is that these fees are monthly "service" fees, capped at the amount listed.

Monthly kwh usage will be charged as usual.

 

[Anti Federalist]

https://twitter.com/energybants/status/1647797927572545537

 

[tod evans]

There's no mention of equity and inclusion whatsoever!

Social credit score MUST be taken into account.

As an aside, I've never had a utility bill under $300.00 in the last 25 years yet out there in the land of fruits-n-nutz they're able to bill six figure incomes under $100.00?
By that metric I should be rolling in FRN's......

Let 'em sink their own ship, I'll keep cutting checks to my local Co-Op...

 

[oyarde]

How are they going to know the income of each household?

My guess is they'll use state tax filings

 

[CaptUSA]

There's no mention of equity and inclusion whatsoever!

Social credit score MUST be taken into account.

As an aside, I've never had a utility bill under $300.00 in the last 25 years yet out there in the land of fruits-n-nutz they're able to bill six figure incomes under $100.00?
By that metric I should be rolling in FRN's......

Let 'em sink their own ship, I'll keep cutting checks to my local Co-Op...

Like I said, there's still a volumetric component to these bills. These are just the fixed charges. If you look at any electric bill, you'll see all sorts of components listed. Most people just pay attention to the bottom line, but when you read articles like this, you have to look at which components are being discussed. Unfortunately, the article doesn't break it down - probably because the reporter has no idea about how electric bills are created.

 

[Brian4Liberty]

Decoupling billing rates from usage rates ... gee, what could go wrong?

I've seen this scenario in action several times. They use as much as they can of what is free or "collectivized". They avoid what is still metered just for them.

For example, low flat rate for electricity, but the gas was still metered. Instead of turning on the gas heater, they turned on the electric stove and oven for heat. Needless to say, they kept burning out the stove heating elements.

Another situation it was water. In an HOA, individual units were not metered, so people with a lot of landscaping went crazy with watering, even during a drought. The HOA had to pay the bill, but that is communal. HOA rates went up, but the water wasters didn't care, because everybody else had to subsidize their usage.