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Utility companies propose making energy bills partially income-based

Electric Meters for Multi-Family Apartment Building
Posted at 7:05 PM, Apr 24, 2023
and last updated 2023-04-24 22:32:57-04

Three major California utility companies have submitted a proposal that could make a portion of your energy bill income-based.

A spokesperson from SoCal Edison told KSBY there are no new charges associated with this change. Instead, it’ll be a restructuring of customers’ energy bills.

“It all started when the California legislature passed a bill last year that required the California State Public Utilities Commission (CPUC) to change the way how electricity bills are structured for residential customers," said SoCal Edison spokesperson Ben Gallagher.

That bill is AB 205, which instructs the state’s public utilities commission to base the residential fixed charge on a customer’s household income level, with lower-income households paying less than higher-income households for the grid and other costs.

That’s where the proposal by PG&E, Southern California Edison, and San Diego Gas & Electric comes into play.

“Under the proposal, the bill would be split for residential customers into two portions — fixed charges and electricity usage," Gallagher added.

He explained the fixed charges would cover things like building and maintaining the grid and customer service.

That portion would be based on household income.

“That’s households earning less than $28,000 per year — they would pay a fixed charge of $15 per month up to our highest earners, which is $180,000 or more per year, and they would pay under the proposal $85 per month in a fixed charge," Gallagher said.

For PG&E customers, the fixed charge could be as low as $15 for low-income families but no greater than $30. Moderate-income customers would pay about $51. And the highest fixed charge, for customers in the top 25% of earners, would be about $92.

“I know that there are a lot of people out there who need help right now, and we always like to give a little when we can and so I don't think it's going to impact my position a whole lot," said Oceano resident Donna Jeffers.

“I think it makes a lot of sense. You know, I think higher-income households tend to use more, more energy anyway because you have, you know, more luxuries," said visitor Pete Johnson.

The other portion of the bill would be electricity usage. Under the plan, Gallagher said those rates would actually drop for all customers by about 33%.

“So the idea here is that this proposal would help to lower bills for low-income customers, create a little more bill certainty for them, hopefully help them be able to participate in clean energy technologies like solar and electric vehicles, while also helping all of our customers manage their bill. Because while there would be that fixed rate, there would also be a decrease in energy usage rates," Gallagher said.

 Under the proposal, the utility companies are recommending that a third party conduct the income verification process for customers.

No changes will be made until after the CPUC issues a final decision, which is expected by July 2024.