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PG&E seeks $1.28B rate hike

2014 request is 18.77% more than 2013 rates already on table

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POSTED November 18, 2012 11:02 p.m.

PG&E is seeking approval of a $1.28 billion rate hike in 2014.

It would add $7 per month to a typical PG&E residential natural gas bill in 2014 and just under $5 a month for a PG&E residential electrical customer. The money generated would go toward infrastructure and safety upgrades.

That is in addition to the rate increase PG&E asked for in June to cover the projected cost of procuring electricity during 2013. The utility is seeking a $540 million increase to bring their revenues strictly for wholesale purchase of electricity to $4.4 billion in 2013. That is in addition to other costs that are itemized on PG&E bills.

Procurement charges are designed as a pass-through for customers with PG&E under state law not being allowed to profit from those specific charges. The 2013 procurement application means an average residential customer using 550 kilowatt hours of electricity would see their monthly bill go up $3.07 in 2013. For a customer who uses 850 kWh the monthly increase would be $12.20 based on figures provided by PG&E.

The general rate case filing last week with the California Public Utilities Commission is an 18.77 percent increase over rates projected for 2013. The CPUC is already allowing PG&E to collect a projected $6.82 billion from ratepayers next year. The $1.28 billion requested for 2014 would be on top of those revenues.

PG&E has asked for the money for additional capital investment for gas and eclectic distribution as well as electrical generation infrastructure. It also will go for improvements in customer service such as SmartMeters as well as new technology to improve safety and reliability. The San Francisco-based utility is also asking for an additional $500 million annually on top of the $1.28 billion in 2015 and 2016. The general rate increase does not reflect any costs associated with increased electricity generation and delivery costs. That is covered in a separate rate request filings.

When PG&E made the preliminary generate rate increase filing for 2014 this past summer a number of elected officials and consumer groups slammed the proposal. Among them was San Mateo Assemblyman Jerry Hill who represents the San Bruno neighborhood leveled in the 2010 PG&E natural gas blast that killed eight people.

Hill contends the 2014 rate increase request as presented would allow PG&E to add $1.7 billion more in profit over the next 45 years on top of what they would already be allowed to earn after covering all expenses.

PG&E noted the rate case for 2014 if approved would support 39,000 additional jobs statewide as the utility updates its system. That would mean an additional payroll of $3 billion annually once the ripple effect is taken into account.

PG&E is also projecting the economic activity the work funded by the rate hike would  also generate $2 billion over three years in state and local tax revenue as a consequence of the added worker income and business income.

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