May 13, 2024 - News

California revamps how it charges for electricity

an illustration of a one dollar bill with a lightning bolt cut out of the middle

Illustration: Tiffany Herring/Axios

The way Californians pay for electricity is changing, based on a decision Thursday by the California Public Utilities Commission.

Why it matters: San Diego had the highest electricity rates in the nation in March.

The big picture: The change, which implements 2022's Assembly Bill 205, lowers rates statewide but adds a fixed monthly fee for infrastructure to residential bills.

  • The CPUC and supporters hope the lower rates will accelerate decarbonization by making electric cars or home appliances more attractive.

How it works: San Diego Gas & Electric customers will see the decrease in the fourth quarter of 2025.

  • Usage rates for electricity will be cut by 5-7 cents per kilowatt hour, or about 15%, per the Union-Tribune.
  • The new flat-rate monthly fee will be $24.15, but low-income residents will be eligible for discounted rates of $6 or $12 per month.

What they're saying: Cynthia Martinez, spokesperson for the Predictable Power Coalition, which includes the state's largest utilities and community groups, said in a statement the change ensures an equitable transition to clean energy by decreasing the burden on low-income households.

The other side: Masada Disenhouse, director of climate advocacy group SanDiego350, said the decision expedites decarbonization but ignores conservation and efficiency.

  • She also said the CPUC could have required households to adopt electric cars or appliances to benefit from the rate change.

The bottom line: The biggest benefits will go to people who use the most energy — at all income levels — like large households in inland areas that depend on air conditioning, per Calmatters.

  • That's by design, since increasing use of electric cars or water heaters means increasing home electricity use.
  • Smaller households or energy-conscious ones, especially those living in temperate coastal areas or homes with solar rooftops, could all see their bills rise with the addition of the new fee.
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