About Residential Rate Reform

What Is Changing and Why?

In response to the 2001 Energy Crisis, the California State Legislature capped rates to protect low-usage customers from soaring electricity prices. However, over the past 13 years these price caps have resulted in many customers paying more than their fair share for electricity.

That's why PG&E, working with a broad coalition of consumer and community groups, has received permission from the California Public Utilities Commission (CPUC) to make residential electric rates simpler and more equitable.

Starting August 1, 2014, under new rates approved by the CPUC, the amount that customers pay for electricity will be more in line with the actual cost of serving them. Find out what this means for you, why the changes are necessary, and where the funds will be spent.

What Impact Will the Changes Have on Bills?

PG&E's higher-usage customers, who pay top rates that are more than twice the average residential rate, will enjoy some relief. Other customers who now pay less than average rates for electricity will see a moderate increase in their rates.
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The table below shows the impact on customers at different usage levels and climate zones.

Monthly Usage (kWh) Current Monthly Bill New Monthly Bill (August 1 rates) Change in Bill Inland Coastal Territory Non-CARE** customers 400 $ 55.53 $ 60.70 $ 5.12 800 $ 179.65 $ 173.12 $ (6.52) 1200 $ 323.47 $ 301.28 $ (22.19) Inland Coastal Territory CARE** customers 400 $ 34.96 $ 38.09 $ 3.13 800 $ 88.84 $ 97.73 $ 8.89 1200 $ 144.73 $ 158.06 $ 13.32 Fresno and Merced Territory Non-CARE** customers 600 $ 96.33 $ 100.33 $ 4.00 1000 $ 223.29 $ 214.85 $ (8.44) 1400 $ 366.13 $ 343.00 $ (23.13) Fresno and Merced Territory CARE** customers 600 $ 56.36 $ 61.90 $ 5.54 1000 $ 110.57 $ 121.74 $ 11.17 1400 $ 166.47 $ 182.06 $ 15.59 *Table shows an illustrative range of electricity usage levels in two major climate zones. Territory X (inland coastal) includes the communities of Ukiah, Santa Rosa, Concord, Oakland, San Jose and King City. Actual bill impacts will vary depending on the customer's usage, baseline territory and baseline allotment. **CARE (California Alternate Rates for Energy) is a PG&E program that gives qualifying households monthly discounts on energy bills.

What About CARE Customers?

Customers in the California Alternate Rates for Energy (CARE) program will see increases in their rates. However, they will continue to benefit from substantial discounts of up to 44 percent in 2014, up from 15 percent in 2000.

How Will the Funds Be Invested?

These rate changes will not increase PG&E's overall revenues or profits. PG&E's average bills will remain among the lowest in the country.
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Where Does My Energy Dollar Go?

PG&E invests the money it receives from residential customers like you to improve safety, reduce outages and provide cleaner energy. This chart illustrates some of the major costs:

Average Standard Rate for Electricity

Energy Supply (56%): The cost of generating and purchasing power for PG&E customers. More than 50 percent of our electricity comes from sources that are free of greenhouse gas emissions, giving us some of the cleanest energy supplies in the nation.

Transmission & Distribution (32%): Operating and maintaining the grid to deliver safe, reliable service. Includes new Smart Grid technology to reduce outages and more quickly restore service to customers.

Public Purpose Programs (7%): Promoting the public good, including discounts for income-qualified customers, investments in energy efficiency programs, and the California Solar Initiative.

Other (5%): Legacy costs for nuclear plant decommissioning, electric generation deregulation, and the impact of the 2001-2002 California energy crisis.

 

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