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Possible Relief From Sizzling Summer Power Bills

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Sacramento, CA – The Mother Lode could get needed relief from sizzling summer power bills and beyond if a new proposal is approved by state regulators that changes how customer charges are calculated.

California’s largest power companies calculate electricity bills based on usage; the more power used, the more money customers pay for electricity, maintenance, and wildfire risk reduction. A proposal by state regulators aims to change this by introducing a fixed charge portion of bills, which would be $24.15 per month for most people. Low-income assistance programs or those living in deed-restricted affordable housing would pay less, either $6 or $12, depending on their situation.

To offset this new charge, the rate people pay for using power would go down. During peak hours when electricity is in the most demand and the most expensive, rates for customers of the state’s big three utilities would fall between 8% and 9.8%. For example, the average customer in Fresno, where temperatures were at or above 100 F (37.8 C) for 17 days last July, would save about $33 during the summer months, according to the California Public Utilities Commission.

The proposal has prompted backlash from some state and federal lawmakers, who argue that the California Public Utilities Commission is out of touch with consumers and should prioritize driving down consumers’ overall bills. A group of 18 members of Congress from California sent a letter urging state regulators to keep the new fixed rate low, stating that the average monthly fixed charge in the United States is $11.

“There is little to stop utilities from continuing to increase electric rates once they secure the highest fixed charges in the country,” stated the letter.

The Predictable Power Coalition, which includes the big three utilities, called the fixed rate “vital” and said the proposal “is a step in the right direction.” Some of the state’s best-known consumer advocates, including The Utility Reform Network and the California Public Advocates Office, support the proposal because they say it would make utility bills more affordable. However, others, including the solar industry, worry that if electricity rates are cheaper during peak hours, people won’t conserve as much energy.

The state legislature ordered regulators in 2022 to implement a fixed charge by July 1 of this year, as California is one of the only states that doesn’t already have one for its largest utilities. Earlier this month, regulators approved an average increase of $32 per month for Pacific Gas & Electric Company customers, as reported here. The average price per kilowatt hour of electricity for California’s big three utilities, including Pacific Gas & Electric, is about 36 cents, compared to the national average of 17 cents.

If approved, the new rule will take effect next year, and customers will not see the charge until later that year or in early 2026.