California regulators on Thursday will likely change the way some utility companies calculate customers' bills, a decision that will make it cheaper to charge electric cars and cool them in the summer. Electricity rates for people who do not use electricity will rise. That much energy.
The California Public Utilities Commission is scheduled to vote on whether to allow the state's major investor-owned utilities, including Pacific Gas & Electric, to add a fixed fee to people's monthly electricity bills. be. For most people, the cost is $24.15 a month, which covers installation and maintenance costs for the equipment needed to bring electricity to your home. Low-income residents enrolled in one of the two discount programs would pay less, at $6 or $12 a month.
In exchange for the new rate, your electricity bill will drop by 5 cents to 7 cents per kilowatt hour. One kilowatt-hour is the amount of electricity required to run a 1,000-watt appliance (such as a coffee maker or vacuum cleaner) for one hour.
For people who use a lot of energy each month, this can potentially reduce their monthly bills. The commission says people living in Fresno, where temperatures often exceed 100 degrees Fahrenheit (37.8 degrees Celsius), can save about $33 by running their air conditioners during the summer. This is because the amount saved by lowering electricity prices will be greater than the amount paid in the new fixed rate.
It would also benefit people who own electric cars and use other appliances such as heat pumps. They save an average of $28 to $44 a month, the commission said. According to the U.S. Energy Information Administration, California will account for 37% of the nation's light electric vehicles in 2022, about six times as many as Florida, which ranks second.
Administrative Law Judge Stephanie Wang wrote in a proposed decision explaining the fee that “the new fee structure distributes fixed costs more evenly among customers and helps customers adopt electric vehicles or gas appliances. “We would encourage people to replace it with electrical appliances because it's cheaper.”
For people who use less energy, the new fixed rate could increase their monthly bill. This includes people who live in small apartments or people who live in cooler areas and don't use air conditioning as much. That's because, for them, the reduction in their electricity bill isn't enough to offset the amount of their new monthly bill.
Opponents say it will discourage energy conservation, which California is encouraging people to do.
“If you wanted to design a policy instrument that would send a signal that conservation doesn't matter, this would be it,” said Ken Cook, chairman of the Environmental Working Group.
Most states have a fixed monthly fee for utilities to pay for grid maintenance and infrastructure. But in California, where electricity prices are among the highest in the nation, any move that could raise rates for anyone is raising alarm among consumers and elected officials.
A group of 18 California lawmakers called on the commission to keep rates low, noting that the national average fixed utility rate is $11. Some Democrats and Republicans in the state Legislature support legislation that would cap fees at $10 a month.
“In order to contain the ever-increasing cost of living in our state, we must do more to increase the cost of living, rather than find new ways,” California Senate Republicans wrote in a letter. in a letter asking the association to reject the proposal.
The proposal is far lower than the $53 to $71 monthly rates the state's investor-owned utility companies have been demanding. The commission also points out that power companies are already allowed to raise rates during peak hours, and argues that the rates do not undermine conservation.
