By Tim Henderson
On December 13, 2018, California utility giant PG&E submitted its 2020 General Rate Case (GRC) to the California Public Utilities Commission (CPUC).
This far-reaching GRC proposal has several stated goals: to support wildfire prevention, risk monitoring, and response efforts, to add stringent new safety measures (including vegetation management) and to increase resilience to further wildfire risk.
The plan also promises to upgrade utility technology, including electric and gas infrastructure to enhance the utility’s overall ability to offer safe, reliable service.
Beyond those things, though, the PG&E GRC also has some impact on consumers. Here’s what people living in California need to know about the PG&E rate increase of 2019, and what they can expect their bills to look like in the coming months.
PG&E submits a new GRC every three years. Each time the utility giant submits a new GRC, CPUC conducts a thorough review of the proposal. In many cases, the CPUC holds public hearings across California service areas, gathers input from taxpayers, and stages evidentiary hearings where PG&E and its partners are encouraged to testify in public proceeding. After this process, CPUC will issue a final decision about whether or not to adopt PG&E’s proposal.
In the 2020-2022 proposal, PG&E is asking for a $1.1 billion increase over currently adopted revenues for 2019 ($8.506B Adopted for 2019 to $9.6B in 2020).
According to PG&E itself, “More than half of PG&E’s proposed increase would be directly related to wildfire prevention, risk reduction, and additional safety enhancements. Among the important wildfire safety investments in the GRC proposal are the following components of PG&E’s expanded Community Wildfire Safety Program:
As noted, this rate case calls for $1.1 billion in 2020, $454 million in 2021 and $486 million in 2022, respectively, to capture inflation and other cost escalation.”
Taken alone, the PG&E proposal may seem like a large ask from customers. In reality, though, the proposal is just the most recent iteration of an ongoing change to PG&E’s rate structure. Back in July 3, 2015, the CPUC voted to adopt a sweeping series of changes to the utility’s residential rate structure. This tipped off ongoing changes for customers throughout California.
Here’s a brief timeline of the changes that have taken place in recent years:
If the CPUC approves PG&E’s 2018 request, customer bills would increase once more. According to the utility, this proposal would increase the average residential customer bill by 6.4%, which equates to about $10.57 per month ($8.73 for electric service and $1.84 for gas service).
According to some outlets, though, customer rates could increase even further than that, especially if federal judges continue to force the utility to undergo wide-ranging management, inspection, and maintenance plans. As Californians know, PG&E is facing ongoing legal and financial woes after its involvement in the catastrophic wildfires that scorched Northern California throughout 2017 and 2018, as well as the fatal 2010 gas explosion that killed eight and decimated a San Bruno neighborhood.
It goes without saying that this is a time of financial uncertainty for PG&E customers. As rates continue to increase, many are becoming increasingly unhappy with the utility. Fortunately, there are other options. Solar power is a rapidly expanding residential power source in California, and going solar now is a great way to decrease spending and make utility costs more sustainable. Additionally, the 30% federal tax credit pertaining to solar projects is set to expire at the end of this year, so now is a great time to take advantage and install solar panels.
If you’re considering going solar in 2019, contact Sandbar Solar to learn more about our newest service offering: helping commercial facilities become energy independent with microgrids consisting of solar panels, battery backups and natural gas generators.
Tim has worked in the solar industry since 2008. He has a Master's Degree in Energy Resources Engineering from Stanford University. His years of experience include working on solar energy projects for both homes and commercial properties. Tim enjoys sharing his knowledge of this evolving industry and making a difference in his community.
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