About Residential Rate Reform

What Is Changing and Why?

To make electric rates simpler for all customers, the California Public Utilities Commission (CPUC) voted on July 3rd, 2015 to adopt a series of reforms to the residential rate structure. As a result, the way utilities charge for electricity is changing throughout California. The new structure is more closely aligned with the actual costs of providing electric service and provides many customers living in high-temperature areas long-overdue relief from high electric rates.

The previous multi-tier rate structure was established during the energy crisis in 2001, when energy was in limited supply, electricity prices were at record highs and issues with electric reliability were frequent occurrences. In addition, renewable energy wasn’t widely accessible and meters were read manually. Since then, things have changed. Progress has been made in nearly every sector of energy.

Expected PG&E rate changes will include:
  • The tiered rate structure will be reduced to two tiers with a separate charge for high usage.

    Tier Collapse


    PLEASE NOTE: The surcharge will ONLY apply to those who use more than four times their baseline allowance.

  • The price difference between the existing tiers will be reduced.
  • Additional Time-of-Use rate plans will be available and outdated plans will be phased out.
  • In 2017, a Super User Electric surcharge will be implemented, increasing in 2018 and 2019.
  • In 2019, the CPUC expects to adopt a default/opt-out Time-Of-Use rate plan for most customers.


PG&E's goal is to make rates simpler and easier to understand. As these changes take effect, we will be sure to explain the impact on your monthly energy statement and provide you with information that can help you save energy and money.
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We're here to help you save energy and money through programs such as CARE, Energy Savings Assistance Program, energy management tips and audit tools, energy efficiency programs and rebates, and payment options including the Balanced Payment Plan.
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Find Rebates and Ways To Save Information »
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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 (50%): 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 (44%): 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 (4%): Promoting the public good, including discounts for income-qualified customers, investments in energy efficiency programs, and the California Solar Initiative.

Other (2%): Legacy costs for nuclear plant decommissioning, electric generation deregulation, and the impact of the 2001-2002 California energy crisis.

  • Local government incentives
  • Lightbulb
  • Energy Upgrade California
 
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