Utility Commission Rejects SDG&E Proposal To Get Rid Of ‘High Usage’ Charge

Speaker 1: 00:00 As how your summer temperatures had our way, so might higher utility bills. And a recent decision by the California Public Utilities Commission may not allow any financial relief for San Diego County. Ratepayers Sdg and e filed a petition to have a tie usage fee removed from its rate structure to save ratepayers a little money, but the CPU see said no. Rob Nikolai [inaudible] is the energy reporter for the San Diego Union Tribune and joined us now to talk about this. Rob, thanks for joining us. Thank you Jane. Good talking to you again. And so why has SGG? Annie asked the CPU see to allow them to get rid of its high usage charge while they wanted to get rid of it because it was implemented. The high usage fee was uh, or charge was implemented November of 2017. And then when we had a really hot summer last summer, the high usage fee kicked in for the first time and people's bills went up a little bit higher in some cases a lot higher. Speaker 1: 00:59 And they complained to the utility and SDG and e came back and said, okay, we're going to go to the California Public Utilities Commission and asked them to get rid or to suspend at least the high usage charge next summer to try to give people a little bit of financial relief. Okay. And we'll get into that more in a minute. But first, you know, why did the California public utilities commissioners say no? They said no because they felt that overall that the impact of a high usage fee was not as dramatic as Sdg and e and some of it's, some of the critics of the high usage charge said, and they also said that the biggest driver is not necessarily the high usage charge. It's using more electricity. It's uh, it's the amount of electricity that's being used, not so much the high use usage chart. And did the CPEC suggests another option for lower bills outside of cutting the high usage fee? Speaker 1: 01:56 Well, they offered that option but it's not really for lowering bills for the option is, was that they said that the uh, suggested that Sdg and e come back and get rid of the differential between summer rates in winter rates and very quickly winter rates are a little bit less for usually about 4 cents a kilowatt hour less than summer rates. And that's something, again, not just somebody that Sdg knee does, it's something that all of the investor owned utilities do as done by edict from the CPC. Um, so it really wouldn't save any money. You would just, instead of having a winter rate in a summer rate, you would combine them and just have one rate and split the difference. So it really wouldn't be a savings, it would just be a reduction in the volatility. So you'd have more consistency over the year rather than having a difference between summer and winter. Speaker 1: 02:50 And there was a big public outcry from customers last summer in response to high electricity bills. Reminded us how that high usage charge works under a tiered rate system. Every electricity residential customer is given an allotment about how much, how many kilowatt hours they can use in a given month. If you use a 130% of your allotment and 130% and under your charge one fee a, in fact it's in the summertime, it's 29 cents a kilowatt hour. For a typical residential customer, when you go over 130%, then every kilowatt hour you expand goes up to 39 cents. And then if you go to four times 400% of your allotment, it then kicks all the way up to 55 cents a kilowatt hour. So we can get expensive pretty quickly. So how much higher where the bills that SDG and e customers received? We got reports. In fact, I talked to a woman last summer in Fallbrook who've had a $656 monthly bill during the height of the summer and last summer was a scorcher in San Diego and that was 50% more than she had paid. Speaker 1: 04:06 Uh, the previous month. Now there's some differential there because you have to ask, well, are people paying a lot more because they're using more or is it just the fault of the high usage charge? Because again, every kilowatt hour you expand over 400% of your allotment. That's when you have to pay 55 cents a kilowatt hour. Now the intent of the high usage charges is to encourage people to use less energy. Is it effective in achieving that? I think it might be a little too early to tell because it wasn't implemented until at the end of 2017. So we've only had it for one whole year and it really has its major effect in the summertime because that's when people really crank up the air conditioners, use their pools more, et cetera. And you know, and um, the, the electricity if you've, if you've got a pool on your property really runs up really high. Speaker 1: 04:59 So it's, I think it's a little bit too early to tell. And as you reported, this decision comes just as SDG and e's new tiered rate structure is rolling out and it doesn't include a high usage fee. So could this all be moot? That's a really good question and that's something that some of the groups that um, filed with the California Public Utilities Commission Against Sdg and e's requests were saying, they were saying that if we're going to move over to time, a few freights witches are completely different than front than tiered rate and we are not Justin Sdgd service territory but across the country if we're going to do that then this problem will basically solve itself cause there's no under a time of use rate structure rather than a tiered structure, there is no high usage charge kicking in. Customers who use lots of power during heat waves for example, be impacted under the new time of use structure. Speaker 1: 05:53 Well under time, if youth is completely different than that than a tiered structure, a time of youth system. It's not necessarily how much electricity you're using it in a given month. It's when you use it, the peak time for people to use electricity. And what the, the utilities commission is trying to get people to, to avoid using electricity from the four to 9:00 PM hours because that's when everyone comes home from work, comes home from school and that's when they turn on their computers, run their dishwashers, turn on their air conditioning. So if you've got time of use rates in effect, if you can encourage them to use their electricity outside of that four to 9:00 PM hour, then they can greatly reduce their electricity bills and what has SDG and e said they intended next SDG and e said that they will look into, instead of having a seasonal differential between winter rates in summer rates, just having one consistent rate. Now that's not necessarily going to lower rates. It'll probably just combine the summer rate and the winter rate so you won't have this wide differential. Normally it's about 4 cents per kilowatt hour between summer and winter. So they'll just have one rate which will affect and help prevent the difference in the volatility. But it's not necessarily going to save people money. I've been speaking with Rob Nicco Lasky, the energy reporter with the San Diego Union Tribune. Rob, thanks so much. Thank you, jade. [inaudible] Speaker 2: 07:26 [inaudible].