NewsLocal News


Why and how much PG&E’s financial woes could add to your monthly bill

Posted at 3:50 PM, Feb 26, 2019
and last updated 2019-02-26 22:56:01-05

California’s largest energy provider is in financial turmoil and those burdens could – and critics argue will – be put on its customers.

Pacific Gas and Electric faces issues on a number of fronts, from a federal judge’s proposal to prevent wildfires which PG&E argues would cost $75-$150 billion, to the company’s Chapter 11 bankruptcy protection in January.

Those hurdles could end up in the laps of ratepayers, squeezing some of the most vulnerable like low and fixed income customers.

“Many of us are one paycheck away from homelessness, but an even larger number are one paycheck away from just constant worry, constant struggle,” said Grace McIntosh, Community Action Partnership San Luis Obispo Executive Director.

CAPSLO helps thousands of clients in the county and is keenly aware of how a shift in cost can make catastrophic changes to their budgets and lives, from rent to medication to their pet’s food.

“In a couple of our other programs we already have seniors saying they’re not taking their medication or they’re cutting their medications in half against doctor’s orders because they can’t afford it,” McIntosh said. “Those are the kind of things we’re talking about.”

“They will feed their animal before they feed themselves,” she said.

Jim McNamara, CAPSLO’s Energy Director, says the organization helps about 3,000 individuals each year with its federal utility services program, HEAP (Home Energy Assistance Program). It’s a one-time payment a year on gas and electric for households in jeopardy of having service shut off. McNamara says the number of people who need that program is much greater.

“If the rates go up, I’m sure the number of people who need that assistance will go up dramatically, and we just don’t have the funds to help them,” he said.

The average customer bill for both residential gas and electric is $166 a month, The Mercury News reported.

In front of the state’s Public Utilities Commission is a set of two proposed increases. One of those increases “would be directly related to wildfire prevention, risk reduction, and additional safety enhancements,” PG&E’s website states. “If approved by the CPUC, this proposal would increase a typical residential customer bill by 6.4 percent or $10.57 per month ($8.73 for electric service and $1.84 for gas service).”

A rate case to help pay for the decommissioning of Diablo Canyon Power Plant would raise electricity bills by $1.98 each month on customers, KSBY reported.

“For most people, ratepayers are going to have to swallow this,” said Jamie Court, Consumer Watchdog President. “Unfortunately, it’s either going to be a very big hit, double-digit rate hit for a short time or more likely, this is more politically palatable, you’re going to see higher rates for the next 30 years.”

Court argues customers face a worse situation than in 2001 when PG&E last filed for bankruptcy. After a settlement, ratepayers were on the hook for $7 billion in costs in Department of Water Resource bonds. That cost still appears on your bill today.

“Not many utilities have had one bankruptcy,” Court said. “You can count them on one hand because they’re regulated monopolies. There has been no utility in the United States with two bankruptcies.”

PG&E declined an interview for this story instead providing a statement to KSBY:

“Our customers have choices in rate plans, and PG&E has tools, tips and programs to help them make the best and most economical choices.”

Court said the bills’ line items aren’t transparent enough on what customers are actually paying for.

“These bills are almost as confusing as a hospital or insurance bill. It’s almost in another language,” he said. “The reason is, I don’t think PG&E and the utilities want you to know what you’re paying for because it would get you pretty angry.”

Now more hikes could be ahead, with those juggling shoe-string budgets in the most danger.

“I absolutely anticipate those numbers are going to go up dramatically,” McIntosh said. “These are things that a lot of us don’t even come into our consciousness. But these are a lot of people. These are the people we deal with every day.”

PG&E offers two discount programs to help eligible customers pay their energy bills. More than 1.4 million customers receive a discount through the programs. You can learn if you’re eligible by visiting PG&E’s website.