California utility companies are advocating for a controversial pricing structure that would bill households a different fixed charge depending on their income — but the idea is catching heat from Republicans who argue it will hurt low-income families.
As you may have already noticed on your own bill, monthly electric bills come with a few fixed fees that are added on top of the charges proportional to your usage rate. These charges go toward operating costs for the state’s electric grid, including maintenance.
Earlier in April, three companies — Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric — submitted a proposal to the California Public Utilities Commission that includes an income-based pricing system for these fixed charges. According to KTLA 5, the monthly charge would vary between the companies, and range from:
• Households making less than $69,000 a year: $20 to $34;
• Households making $69,000 to $180,000 a year: $51 to $73; and
• Households making more than $180,000 a year: $85 to $128.
Recommended for you
The companies say the rate of kilowatt-hour usage will also lower for all customers, but low-income households will benefit the most. PG&E and Southern California Edison estimate its lowest-income customers would, on average, save as much as a 21% on their bill.
But Republican legislators are skeptical that a plan from “a government sanctioned monopoly” will save customers money. On Friday, the Senate Republican caucus fired off a letter to the utilities commission arguing that the pricing proposal would “unfairly burden” low-income residents.
Senate GOP leader Brian Jones of El Cajon and other Republican senators said in the letter: “The goal of trying to stabilize the grid and lower electricity rates is something we support; however, the tactic of implementing a structured fixed-charge system that diminishes individual responsibility and usage in favor of an ‘identity’ subsidization is not, in our opinion, an answer. More fees are not a solution to already ridiculously high utility bills.”
The rising cost of natural gas has caused utility bills to surge, frustrating Californians across all economic levels. But lower-income residents end up paying a disproportionate share of utility expenses.
In the meantime, the first round of comments for the proposal will be due by June 2 and the Public Utilities Commission will be expected to make a final decision on the pricing structure by July 2024.
CalMatters.org is a nonprofit, nonpartisan media venture explaining California policies and politics.
Since when are utility companies concerned about their customers' welfare? Why would a provider need access to our household income levels? Will Safeway and Home Depot be next? PG&E cannot even keep our lights on and now the company wants to engage in further social engineering? It is all designed to deflect their horrendous inefficiency because of their cost plus business model which also leads to bloated compensation for all of their workers and management.
Recently minted lawyers, start your engines… Established lawyers, start your engines… Other folks, start thinking of ways to game the system… Claim to be a low-income household or transfer utility billing to person with lowest income, perhaps a child?
Keep the discussion civilized. Absolutely NO
personal attacks or insults directed toward writers, nor others who
make comments. Keep it clean. Please avoid obscene, vulgar, lewd,
racist or sexually-oriented language. Don't threaten. Threats of harming another
person will not be tolerated. Be truthful. Don't knowingly lie about anyone
or anything. Be proactive. Use the 'Report' link on
each comment to let us know of abusive posts. PLEASE TURN OFF YOUR CAPS LOCK. Anyone violating these rules will be issued a
warning. After the warning, comment privileges can be
revoked.
Please purchase a Premium Subscription to continue reading.
To continue, please log in, or sign up for a new account.
We offer one free story view per month. If you register for an account, you will get two additional story views. After those three total views, we ask that you support us with a subscription.
A subscription to our digital content is so much more than just access to our valuable content. It means you’re helping to support a local community institution that has, from its very start, supported the betterment of our society. Thank you very much!
(2) comments
Since when are utility companies concerned about their customers' welfare? Why would a provider need access to our household income levels? Will Safeway and Home Depot be next? PG&E cannot even keep our lights on and now the company wants to engage in further social engineering? It is all designed to deflect their horrendous inefficiency because of their cost plus business model which also leads to bloated compensation for all of their workers and management.
Recently minted lawyers, start your engines… Established lawyers, start your engines… Other folks, start thinking of ways to game the system… Claim to be a low-income household or transfer utility billing to person with lowest income, perhaps a child?
Welcome to the discussion.
Log In
Keep the discussion civilized. Absolutely NO personal attacks or insults directed toward writers, nor others who make comments.
Keep it clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
Don't threaten. Threats of harming another person will not be tolerated.
Be truthful. Don't knowingly lie about anyone or anything.
Be proactive. Use the 'Report' link on each comment to let us know of abusive posts.
PLEASE TURN OFF YOUR CAPS LOCK.
Anyone violating these rules will be issued a warning. After the warning, comment privileges can be revoked.