PG&E this month raised its electricity rates 3.7%, amounting to a $5.01 a month increase for the average residential customer, who now pays $138.85 a month for electricity. Noel Perry, founder of Next 10, which funds nonpartisan research on the economy and environment. “As this continues it’s going to make electricity even more unaffordable,” said F. At the same time, the state has set high goals toward decreasing reliance on fossil fuel, including by encouraging residents to switch to renewable energy like solar, which often bears a high cost of entry due to costly equipment and installation. While solar users generate power that decreases their bills, they still rely on the state’s electric grid for much of their power consumption - without paying for its fixed costs like others do. “When households adopt solar, they’re not paying their fair share,” Fowlie said. And while the bills of older, wealthier Californians continue to decrease as they adopt cost-efficient alternatives like the state’s Net Energy Metering solar program, costs will keep rising for a shrinking customer base composed mostly of low- and middle-income renters who still use electricity as their main energy source. However, because lower-income residents use only moderately less electricity than higher income households, they end up with a disproportionate share of the burden, according to the study. These are legitimate expenses, Fowlie said. “California’s retail prices are out of line with utilities across the country,” said UC Berkeley assistant professor and study co-author Meredith Fowlie, citing Hawaii and some New England states among the outliers with even higher rates. Even low-income residents enrolled in the California Alternate Rates for Energy program paid more than the average American. The study analyzed the rates of the state’s three largest investor-owned utilities and found that Southern California Edison charged 45% more than the national average, while San Diego Gas & Electric charged double. PG&E customers pay about 80% more per kilowatt-hour than the national average, according to a study by the energy institute at UC Berkeley’s Haas Business School with the nonprofit think tank Next 10. If approved, the fixed-rate bills could be in effect as soon as 2025.For more stories on inequality in California, sign up for Inequality Insights, a weekly must-read on one of California's most pressing issues.Ĭalifornia’s electricity prices are among the highest in the country, new research says, and those costs are falling disproportionately on a customer base that’s already struggling to pay their bills. The California Public Utilities Commission would have to approve the proposal and make a final decision by mid-2024. The State is still figuring out some of the particulars, including how they'll determine customers' income, but Dunleavy said it will be a state agency or a third party vendor. As California natural gas bills go up, here are some tips to save energy and money.Raising the minimum wage for tourism workers in LA.California pauses homebuyer loan program after it runs out of money.Tax Day Is April 18: Haven't filed yet? Here's what to know. ![]() Here's a breakdown of the proposed rate restructuring for Edison customers based on income: Rates for each unit of electricity consumed (kilowatt-hours) would decrease by about 33% for all residential customers," Edison said in a statement. "Under the proposal, SCE’s approximately 1.2 million lower-income customers would receive an average 16%-21% bill reduction, and about half of SCE’s customers would see lower bills, assuming no change in electricity use. Under the current proposal, that rate would go down to 24 cents per kilowatt-hour. Right now the resident rate is 36 cents per kilowatt-hour. "So what the state has asked the utilities to do is to break out those charges for greater transparency so that when customers look at their bills, you're going to see that this amount is going to maintain the infrastructure and how my electricity ism provided and then this amount represents how much I'm using which is actually going to go down 33%," said Dunleavy. Fixed costs include things like building and maintaining the electric grid providing customer support energy efficiency programs and more. ![]() Bills are mostly made up of two things - the kilowatt-hours, or the energy you use, and fixed costs for providing electric services. According to Dunleavy, fixed charges have always been built into the kilowatt-hours that we use to power appliances and turn on the lights.
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