Why PG&E's cheaper rates won't help many in San Francisco
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PG&E is California's largest utility. Photo Illustration: Piotr Swat/SOPA Images/LightRocket via Getty Images
Pacific Gas & Electric announced lower electricity rates for 2026, but San Francisco customers likely won't see much difference on their utility bills, analysts say.
The big picture: The 5% bill decrease applies to customers who buy power directly from the utility, but most San Franciscans get electricity from a city-run provider.
- Meanwhile, rising delivery charges — fees covering infrastructure maintenance — continue to push bills higher.
What they're saying: "PG&E is taking credit for something it didn't really do," attorney Matthew Freedman of the consumer advocacy group The Utility Reform Network, told Axios. "They claim everybody got a rate decrease. It's simply not true."
Between the lines: Most San Franciscans get electricity from CleanPowerSF, a community choice aggregator that sells residents power it gets from renewable sources, while the PG&E handles grid improvements and billing.CCAs set their own rates.
- When PG&E announced its rate reduction, it was referring to its own electricity supply charges — not delivery costs, which increased, Freedman said.
Of note: Delivery costs pay for maintaining PG&E infrastructure such as power lines, substations and meters. They're rising as PG&E spends billions on wildfire prevention and grid upgrades, costs that are passed on to customers.
The other side: PG&E spokesperson Mike Gazda told Axios customers can contact CCA providers directly "for more information about how their generation rates may change."
On top of the rate update, a new "base service charge" will change how electricity is billed.
- Starting in March, most PG&E customers will see a flat $24 monthly charge, regardless of usage.
- The charge covers some fixed power grid costs, allowing lower per-kilowatt-hour prices for higher-use customers.
Catch up quick: The change stems from a 2022 state law aimed at encouraging Californians to switch from gas-powered appliances and cars to electric ones, shifting away from pricing designed to discourage energy use as the state moves toward electrification.
Caveat: San Franciscans are unlikely to see major savings because they use less electricity than customers in hotter regions.
- Any relief would likely appear during winter heating spikes. Even then, "we're talking about swings of maybe five dollars up or down," Freedman said. Customers with heavy air conditioning use stand to benefit most.
Context: The billing changes follow repeated San Francisco power outages that have revived debate over reliance on PG&E.
- Local lawmakers have renewed calls for a public utility, which often delivers cheaper power by financing with tax-exempt bonds.
Yes, but: Taking over PG&E's system would be costly and legally complex,
What's next: City leaders say they'll continue pressing PG&E over outages while exploring whether public ownership could offer more control and lower costs.
Editor's note: This story has been corrected to reflect that CleanPowerSF sells power from renewable sources (not from PG&E).