A typical customer in Manteca, Lathrop, and Ripon who uses 650 kilowatts in a particular month will see a savings of $9 in their PG&E electric bill for energy consumption after June 1.
It is part of an average 3 percent drop in most electric rates for PG&E customers approved Thursday by the California Public Utilities Commission.
That typical customer using 650 kilowatts a month now pays $79. That bill will drop to $70 a month under the new PG&E rate charge.
The PG&E rate request was part of the utility’s response to Central Valley customers whose bills spike significantly when hot weather prompts heavier air conditioning use.
The utility accomplishes the reduction by eliminating two of its five-tier system put in place decades ago at the state’s insistence in a bid to encourage energy conservation.
The five-tier system has been particularly rough on PG&E customers that resort to running air conditioning for longer periods in areas that experience extensive heat waves such as the Central Valley.
Residential customers that use 1,150 kilowatts in a particular month will see their electricity bill go from $270 to $250.
As things stand now, someone who doubles their monthly power use going from 650 to 1,150 kilowatts would see their actual bill go up 3.4 times. That’s because of the five tiers. Once residential customers reach the fifth tier in usage, they start paying 50 cents a kilowatt after that. The new rate structure would eliminate the top two tiers and drop the highest rate down to just under 30 cents per kilowatt hour.
The tiers are based on a percentage of the baseline use in various sub-regions impacted by different climates that PG&E serves in Northern California. The amount of electricity allowed in a given month under the lowest tier is determined by what the basic electricity needs are of typical customers in a region.
The baseline rate concept was established in 1993. It essentially either lowered the power bill for those who could least afford it and also rewarded those who conserved electricity with lower rates. The rates that could be charged to the two lowest tiers was capped by the CPUC in 2001 and remained that way until last November when upward adjustments were allowed under legislation adopted by California lawmakers.
Essentially that meant higher use residential customers have been subsidizing lower residential customers to an increasing degree since 1993. The application for the June 1 rate adjustment is revenue neutral for PG&E. The five-tier strategy was in response to goals established by California for public utilities to encourage energy conservation and to assist low-income customers.
“California is in the midst of its worst economic downturn in nearly 70 years,” said Helen Burt, PG&E’s senior vice president and chief customer officer. “We have an obligation to all our customers to help them keep their energy costs and usage in check.”
PG&E noted they will lower average electric rates for all customers 3.0 percent. The top residential rate charged for the highest levels of use will drop by 19.6 percent in all parts of its service area. Rates for the next highest level of use will drop by 5.8 percent. Rates for the middle tier will rise 1.8 percent to help offset the other declines.
It is part of an average 3 percent drop in most electric rates for PG&E customers approved Thursday by the California Public Utilities Commission.
That typical customer using 650 kilowatts a month now pays $79. That bill will drop to $70 a month under the new PG&E rate charge.
The PG&E rate request was part of the utility’s response to Central Valley customers whose bills spike significantly when hot weather prompts heavier air conditioning use.
The utility accomplishes the reduction by eliminating two of its five-tier system put in place decades ago at the state’s insistence in a bid to encourage energy conservation.
The five-tier system has been particularly rough on PG&E customers that resort to running air conditioning for longer periods in areas that experience extensive heat waves such as the Central Valley.
Residential customers that use 1,150 kilowatts in a particular month will see their electricity bill go from $270 to $250.
As things stand now, someone who doubles their monthly power use going from 650 to 1,150 kilowatts would see their actual bill go up 3.4 times. That’s because of the five tiers. Once residential customers reach the fifth tier in usage, they start paying 50 cents a kilowatt after that. The new rate structure would eliminate the top two tiers and drop the highest rate down to just under 30 cents per kilowatt hour.
The tiers are based on a percentage of the baseline use in various sub-regions impacted by different climates that PG&E serves in Northern California. The amount of electricity allowed in a given month under the lowest tier is determined by what the basic electricity needs are of typical customers in a region.
The baseline rate concept was established in 1993. It essentially either lowered the power bill for those who could least afford it and also rewarded those who conserved electricity with lower rates. The rates that could be charged to the two lowest tiers was capped by the CPUC in 2001 and remained that way until last November when upward adjustments were allowed under legislation adopted by California lawmakers.
Essentially that meant higher use residential customers have been subsidizing lower residential customers to an increasing degree since 1993. The application for the June 1 rate adjustment is revenue neutral for PG&E. The five-tier strategy was in response to goals established by California for public utilities to encourage energy conservation and to assist low-income customers.
“California is in the midst of its worst economic downturn in nearly 70 years,” said Helen Burt, PG&E’s senior vice president and chief customer officer. “We have an obligation to all our customers to help them keep their energy costs and usage in check.”
PG&E noted they will lower average electric rates for all customers 3.0 percent. The top residential rate charged for the highest levels of use will drop by 19.6 percent in all parts of its service area. Rates for the next highest level of use will drop by 5.8 percent. Rates for the middle tier will rise 1.8 percent to help offset the other declines.
