State Officials Just Raised Your Utility Rates When You Weren't Looking
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Friday was a federal holiday, and many of us were unplugged.
The California Public Utilities Commission decided that was the right time to raise your electricity rates. Really. The good news is that the expected hikes, which could come as soon as November, don't apply to publicly owned utilities like the L.A. Department of Water and Power.
The bad news is this could hit you by the end of the year if you're a Southern California Edison customer.
The commission voted unanimously to squeeze the current rate system from four tiers of ratepayer groups to two. The result is that lower-income electricity users, whose rates were frozen thanks to efforts to get wealthier users to conserve by charging them more, will see their bills go up.
For one thing, an extra $5 a month will be tacked onto the bills of low- and moderate-income customers. That charge will be $10 for the upper crust.
The investor-owned utility companies argued that lower-income folks were not paying what it cost to produce the electricity. The source of the old payment system was an energy scare at the dawn of the '00s. The result was that higher-end users paid 50 percent more than normal if they used too much.
Now they could pay 25 percent more than normal, and the rest of you will have to pick up the slack.
In a statement, the five-member PUC called the new system "a more effective and cost-based structure, empowering consumers with more opportunities to conserve, and promoting resource optimization and grid reliability."
President Michael Picker:
The world has changed since 2001, when rates were frozen by the Legislature. Over time, with lower-tier rates being frozen, the five-tiered rate structure departed increasingly from any cost basis and imposed even greater inequities on large family households that were pushed into higher tiers in hot climate zones. Our decision helps align rates with the actual cost of service.
The world has changed, all right.
The rich have gotten much, much richer. A report by California Common Sense found that while overall income increased in the Golden State two years after the Great Recession, "The bottom 99 percent’s combined income actually decreased."
The Utility Reform Network lobbied against the two-tier system. Mark Toney, executive director of the group, said previously that the new system "provides huge windfalls to a few wealthy energy hogs."
"The current system of tiered rates is intended to reward conservation and keep rates affordable for low- to moderate-usage customers in all climates," the network said in a statement. "Flattening rates and adding fixed charges would primarily benefit higher-usage customers."
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