July 16, 2024 Breaking News, Latest News, and Videos

Will California Power Companies Start “Robbing The ‘Hood’”?:

For decades, Californians who use the most electricity have paid extra for that privilege, on the theory that high prices might provide an incentive for them to use less.

This system is designed to allow all ratepayers enough power for basic needs at very low prices, with the extra energy needed to run things like Jacuzzis and charge items like Tesla sedans coming at a premium price.

One typical Southern California Edison bill for the month of February showed up to 314 kilowatt hours costing just over 12 cents each, for a total of $40.06, while the top tier of that same bill had 135 kilowatt hours priced at almost 30 cents each, for a total of just over $50, about 25 percent more for only about 40 percent as much power included in the bottom tier.

Transmission costs for all rate categories were about 8.5 cents per kilowatt hour, meaning the difference in the cost of the energy itself was 17 cents between the first power used and the last, a difference of about 400 percent from the bottom tier to the top one.

This may be about to change, as the state Public Utilities Commission considers a proposal by Pacific Gas & Electric Co. to cut the number of payment tiers from four to two, a move that would likely raise the rates of low-usage customers. Yes, that’s the same PG&E indicted for criminal negligence in its fatal mismanagement of natural gas pipelines.

A further change, added to switches in raw pricing, would see discounts available to low-usage (read: poor) customers cut by as much as 20 percent from today’s levels. That’s one reason the current proposals are the very opposite of a Robin Hood plan that would take more from the rich, but rather have been called “robbing the hood.”

If approved for PG&E, it’s almost certain the same rate structure would be imposed soon after in the vast territories of Edison and San Diego Gas & Electric. Typically, systemic changes in utility regulation begin with PG&E and spread to the other companies less than a year later.

Some of this switch is prompted by complaints from electric users in the Central Valley and other high summer heat areas where air conditioning runs up electric bills. The current rate structure sees utilities charge high-use customers more for power than low users, regardless of where they live.

But it’s also quite likely driven by a 2012 legislative conference on Maui, where some lawmakers saw their expenses paid by corporations and/or labor unions.

Rate restructure was pushed there by meeting sponsors, who had great access to legislators of both major parties, including some members of both parties’ leadership. Disclosure documents showed lobbyists there discussed energy rate changes with Assembly Republican leader Connie Conway of Tulare and Republican Fresno area state Sen. Tom Berryhill, for two examples.

Editorialized one newspaper during the conference, “The elected officials…receive the free trips because of…their capacity to affect public policy.”

If the businesses and their union workers, users on average of far more power than almost any household, had even a slight influence on passage of last year’s AB 327, which enables some of the changes now being considered, a few plane tickets will have proven a superb investment for them.

PG&E, in pushing for the rate restructure, says it wants to make prices more sensitive to time of use, with power employed at night or in early morning hours cheaper than kilowatts used in the hottest, highest-use hours of the day.

That’s laudable, and has often been combined into the existing rate structure, which gives preference to small users. But it also could doom many poor, elderly Californians to heatstroke and worse if they can’t afford air conditioning.

If the PUC approves rates favoring big users over small ones, the folks calling this robbing the hood will be proven right. For it would be a classic reverse Robin Hood tactic, robbing the poor and rewarding the rich.

in Opinion
Related Posts

SM.a.r.t. Column: Food Water and Energy Part 1 of 3

July 14, 2024

July 14, 2024

Civilization, as we know it, requires many things, but the most critical and fundamental is an uninterrupted supply of three...

Letter to the Editor: Criticizing Israeli Policy Is Not Antisemitic

July 10, 2024

July 10, 2024

In the past several months, we’ve seen increasing protests against Israel’s actions in Gaza. We have also seen these protests...

SMA.R.T. WISHES ALL A VERY HAPPY 4TH OF JULY WEEK

July 7, 2024

July 7, 2024

We trust you are enjoying this holiday in celebration of Independence. Independence to be embraced, personally and civically, thru active...

SM.a.r.t Column: Santa Monica Under SCAG’s Boot

June 30, 2024

June 30, 2024

Four years ago, our esteemed colleague Mario Fonda-Bonardi wrote the prescient essay below when much of the legislative development juggernaut...

SM.a.r.t Column: The Up Zoning Scam (Part 2)

June 23, 2024

June 23, 2024

Last week’s SMart article  (https://smmirror.com/2024/06/sm-a-r-t-column-the-up-zoning-scam-part-1/)  discussed the ambitious 8895 units (including 6168 affordable units) that Santa Monica is required to...

SM.a.r.t Column: The Up Zoning Scam (Part 1)

June 16, 2024

June 16, 2024

Over the last few years, the State of California has mandated a massive upzoning of cities to create capacity for...

SM.a.r.t. Column: Shape Up – On Steroids

June 9, 2024

June 9, 2024

Nine years ago, SMa.r.t wrote a series of articles addressing the adaptive re-use of existing structures. We titled one “Shape...

SM.a.r.t Column: The Challenge of Running a City When City Staff Have Different Priorities

June 2, 2024

June 2, 2024

Living in a city has its perks, but it can be a real headache when the folks running the show...

SM.a.r.t. Column: A Path to Affordable Ownership in Santa Monica

May 27, 2024

May 27, 2024

[Note: our guest author today is Andres Drobny, a former Professor of Economics at the University of London, the former...

SM.a.r.t. Column: A Path Forward for Santa Monica: Part II

May 19, 2024

May 19, 2024

As referenced in Part I of this article, the state’s use of faulty statistics and forceful legislation has left a...

SM.a.r.t. Column: A Path Forward for Santa Monica: Part I

May 12, 2024

May 12, 2024

To quickly summarize, California grapples with an ongoing housing crisis spurred by state implementation of over 100 policies and mandates...

SM.a.r.t. Column: Where Will Our Huddled Masses Sleep? Navigating California’s Affordable Housing Mandates

May 5, 2024

May 5, 2024

Just as Lady Liberty beckons the “huddled masses” of immigrants to America, cities like Santa Monica have an ethical obligation...

SM.a.r.t Column: SMCLC SPEAKS

April 28, 2024

April 28, 2024

SMart (Santa Monica Architects for a Responsible Tomorrow) periodically invites guest columnists who have made a significant contribution to the...

SM.a.r.t Column: Building Modern Boxes Lacks Identity

April 21, 2024

April 21, 2024

In the relentless pursuit of modernity, cities worldwide have witnessed the rise of so-called architectural marvels in the form of...

SM.a.r.t. Column: Santa Monica Needs Responsible Urban and Architectural Design

April 14, 2024

April 14, 2024

[SMa.r.t. note: Eight years ago, our highly esteemed and recently-passed colleague Ron Goldman documented his thoughts on the need for...