Proposed PG&E hikes criticized

Nonprofit says increase unfair to low-income users.

April 29, 2011 

Rate increases proposed by Pacific Gas & Electric Co. would harshly affect low-income customers and give a break to customers who use the most electricity.

That's the opinion of the Greenlining Institute, a nonprofit that conducts policy advocacy in many areas. The institute filed comments this week with the California Public Utilities Commission opposing a draft decision to allow PG&E to change its electricity rates. The rate changes will go before the commission Thursday. If approved, they would go into effect Nov. 1.

"The rates on the table now could be detrimental, especially to the Central Valley and to the poor," said Stephanie Chen, senior legal counsel for Greenlining.

Not quite true, said Christine Cordner, spokeswoman for PG&E.

"Over the years, we've had more costs and needs, more customers, and we've had to spread that revenue need over less customers," Cordner said. "As a result, rates have become unfair to some customers who have paid more than their fair share."

For most customers who use PG&E, there are four tiers of usage, and the cost per kilowatt goes up with more usage.

But for low-income customers, there are only two tiers, Cordner said.

"We have a big base of customers that don't ever have their rates changed," she said.

The rates proposal would add a third tier for the low-income users. Cordner said that consumers who get to that third tier would still be paying much less than other customers. "We want people to pay closer to what it costs to give them energy," she said.

Chen said bumping up rates for the lowest-income users isn't the way to go. "The punchline is these changes would raise rates to low-income customers and to those who use less energy," she said.

Cordner said low-income customers pay about 8.3 cents per kilowatt hour for Tier 1 usage and about 9.5 cents for Tier 2. At the third tier the cost would rise to 12.5 cents per kilowatt hour.

In comparison, regular customers pay about 14 cents a kilowatt hour for Tier 2. Those at Tier 4, the highest level, pay about 40 cents. Under the proposal the Tier 4 cost would be lowered to about 32 cents per kilowatt hour.

"The proposed changes center around the idea of rate equity and what it costs to serve the customers," Cordner said. "Right now, the gap is too big between low and high use."

"These proposals rob Peter to pay Paul," Chen countered, "even though Peter has less money and is doing a better job of saving energy. The people who have five big-screen TVs and a pool will get their rates cut, and the poor will be paying more."

To comment on the proposed rate hikes go online to www.cpuc.ca.gov/PUC/aboutus/Divisions/CSID/Public+Advisor. Those who want to attend the meeting Thursday in San Francisco can sign up for public comment at https://ia.cpuc.ca.gov/

requesttocomment/.

Reporter Carol Reiter can be reached at (209) 385-2486 or creiter@mercedsun-star.com.

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