PG&E customers face big bill increases due to state regulatory proposals

OAKLAND — PG&E customers, already hit with big increases in their monthly bills in recent years, face a fresh round of price hikes. On Wednesday, officials with the state Public Utilities Commission that regulates PG&E issued two proposals that would allow the utility to increase the amount of revenue it can extract from ratepayers in 2023. One proposal was fashioned by one of the five powerful commissioners with the state PUC while a second proposal was crafted by PUC administrative law judges.

Oakland-based PG&E had already issued its own version of what it seeks from customers to finance an array of endeavors the company claims will improve the safety, efficiency and reliability of the utility behemoth’s electricity and gas systems. The PUC is slated to make a final decision on how high the rates will be sometime in November. Broadly speaking, the PUC would be expected to choose one of the three versions for the higher monthly bills, reject all three, or cobble together a fourth scenario to raise customer costs.

In 2022, PG&E was authorized to collect $12. 2 billion in revenue. The various proposals allow the utility to harvest even more revenue — the vast majority of which is provided by ratepayers.

Here are the three proposals for the amount of revenue PG&E would be allowed to capture during 2023: — $1. 1 billion increase in revenue, or 9% more than what PG&E collected in 2022. This version was proposed by state PUC Commissioner John Reynolds.

— $1. 6 billion increase in revenue, or a 13% increase. This plan was proposed by PUC administrative law judges.

— $3. 2 billion increase in revenue, or a 26% jump. This is PG&E’s proposal.

“PG&E’s general rate case proposal continues the transformation of our energy system to further reduce wildfire risk, improve safety and climate resilience, and support continued growth of clean energy,” PG&E spokesperson Lynsey Paulo said. More than 85% of PG&E’s proposed increase would go toward reducing risk in gas and electric operations, Paulo added. “PG&E’s job is to propose a four-year budget, including its plans for the activities it needs to carry out to deliver safe and reliable services to its customers,” said Rachel Peterson, the state PUC’s executive director.

In the utility’s initial application, PG&E proposed numerous changes it claimed were necessary to ensure the safety and reliability of its energy services. “Inflation and a significant investment in undergrounding electric lines ranked among the top cost drivers in PG&E’s request,” the PUC stated in a prepared release. The varying proposals arrive at a time when the bills that residential customers must pay each month have skyrocketed.

Bills have gone up in part because of rising gas and energy costs and also because of system upgrades and wildfire mitigation. About five years ago, in March 2018, PG&E’s average bill for the typical residential customer who received electricity and gas services from the utility was $169. 73 a month.

In January 2023, the average combined bill was $240. 73 a month — meaning PG&E monthly bills have increased by nearly 42%. Over the five years that ended in August 2023, the overall Bay Area inflation rate has risen 13.

5%, or 2. 7% a year. Put another way, PG&E’s monthly utility bills are rising three times faster than the pace of inflation in the Bay Area.

“Our job by the end of the proceeding is to reach a proposed decision on the services and initiatives PG&E should commit to over the next four years, and the amount of money it can collect from its customers to cover the cost,” PUC Executive Director Peterson said. .