OAKLAND — PG&E customers face the forbidding prospect of even higher monthly bills starting this spring.
An administrative law judge for the state Public Utilities Commission (PUC), which oversees the utility, has issued a proposed decision that clears the way for commissioners to make a final decision in March to authorize PG&E to extract more money from customers. Law Judge Camille Watts-Zagha issued the proposal.
PG&E customers could be paying $4 to $6 more a month for their utility service if the powerful five-member PUC panel agrees with the proposal issued by the PUC law judge, estimated Mark Toney, executive director of The Utility Reform Network, or TURN.
Oakland-based PG&E said it is still crunching numbers, but it believes the monthly increase might be lower.
The higher bills could take effect in April or May if the PUC agrees with the proposed ruling.
“PG&E is authorized to recover a maximum of $516 million (75 percent of PG&E’s total request of $688 million) in interim rates,” Judge Watts-Zagha stated in her proposed decision.
PG&E wants approval for the higher bills to cover expenditures in recent years related to wildfire safety as well as modernization, safety and compliance spending for the utility’s electricity and gas systems.
“These costs were not included in prior rate proceedings, and we have requested to recover these costs over multiple years to limit the impact on customers,” PG&E spokesperson Mike Gazda said in comments emailed to this news organization.
“Delaying the recovery of costs could negatively impact our ability to secure competitive finance rates and increase the costs for capital investments,” Gazda said.
PG&E’s efforts to institute higher monthly bills have emerged at a time when the utility is poised to report a profitable 2023 and anticipates a rosy 2024.
During a business update in November 2023, PG&E predicted 2024 would produce profits of $1.31 to $1.35 a share. If that occurs, the 2024 profits would leap 10% above the anticipated earnings per share for all of 2023, which itself is expected to be 10% higher than 2022.
Despite its predictions of a profitable 2024, PG&E said it must confront an intensified squeeze on its finances.
“Interim rate relief would help mitigate the extraordinary financial pressure currently facing PG&E,” the company stated in a regulatory filing.
Starting with the January 2024 billing cycle, monthly bills for PG&E customers averaged roughly $294.50 a month for the typical residential customer who receives combined electricity and gas services, according to estimates the utility provided to this news organization.
That combined bill is 22.3% higher than the average monthly charges that went into effect a year earlier, at the start of January 2023, when combined bills were $240.73 for the typical residential customer.
PG&E says its goal is to bring annual increases in combined electricity and gas bills close to the annual inflation rate.
The 22.3% increase, however, greatly exceeds the 2.8% rise in the Bay Area inflation rate as measured by consumer prices during the 12-month period that ended in October.
Toney believes the PUC will agree to the proposal. He noted that the state PUC has approved four prior requests by PG&E for interim rate relief.
“The chances are good that this will sail right through,” said Toney, who worries the potential for higher utility costs has materialized without a hard cap to the increases.
TURN has floated the concept of limiting annual increases in PG&E monthly bills to no more than the annual cost of living, which is roughly equivalent to the yearly change in the inflation rate as measured by the consumer price index.
“The greed of utility executives and Wall Street investors may have no limits,” Toney said, “but customers who are falling behind on their bills need a limit to bill increases.”
