fter a summer of record temperatures that left many San Diego Gas & Electriccustomers with high electricity bills, the utility told the Union-Tribune on Wednesday that it plans to go before the California Public Utilities Commission and ask for a number of policy changes aimed at reducing the financial burden on ratepayers.
Among the proposals is a call to eliminate a “high usage charge” the commission recently put into place that bills customers at a much steeper rate when they use more than four times the electricity their homes are allotted each month.
“One thing that we’ve heard loud and clear from our customers this summer is that they do not like the high usage charge and we agree,” said Scott Crider, SDG&E vice president of customer services. “We would like to get rid of it completely.”
The high usage charge has been a particular sore spot for some customers as the San Diego area suffered through a sweltering July and the hottest August on record. Temperatures in Ramona hit 117 degrees on July 6.
As people cranked up their air conditioners, many exceeded their respective monthly “baseline allowance” — the predetermined amount of kilowatt-hours of electricity a home or residence is deemed to need each month.
Customers in a standard SDG&E tiered billing system pay 27 cents per kilowatt-hour during the summer season (June 1-Oct. 31) and 23 cents a kilowatt-hour in the winter (Nov. 1-May 31). If usage exceeds 130 percent of the baseline, the price goes up to 48 cents per kilowatt-hour in the summer and 40 cents in the winter for that tier.
Last November, at the direction of the CPUC, utilities instituted a high usage charge when energy use exceeds 400 percent of baseline. In SDG&E’s service territory, the high usage fee is 55 cents a kilowatt-hour in summer and 47 cents in winter.
The commission mandated the charge to all the utilities it oversees to try to promote energy conservation across the state.
When temperatures soared this summer, the full impact of the high usage charge was felt. SDG&E has estimated 81,000 ratepayers have exceeded 400 percent of baseline this year, which represents about 6 percent of the utility’s 1.4 million residential customers. SDG&E has been flooded with complaints about high-priced bills.
“Our customers have made it clear that they don’t believe the high usage charge is fair and we’re responding,” Crider said.
Mindy Spatt, communications director at consumer advocacy group The Utility Reform Network, was skeptical about the move.
“The best way to avoid rate shock is to reduce rates. But SDG&E isn’t saying, ‘We’re reducing rates,’ “ Spatt said. “If high usage customers aren’t going to pay (the high usage charge), won’t other customers have to make up the difference?”
SDG&E officials offered four other proposals they say they will argue in the coming weeks and months to the CPUC, which regulates and sets policy for all three of the state’s investor-owned utilities — SDG&E, Southern California Edison and Pacific Gas & Electric.
The utility says it also will call for an end to seasonal pricing, in which summer rates are higher than winter. Edison and Pacific Gas & Electric do not have seasonal pricing but Crider said they have been moving toward it.
“One thing I’ve heard from customers is the unexpectedly high bill in August or September that is difficult to manage,” Crider said. “We think eliminating seasonal pricing could be a good solution” to reduce volatility of bills for some customers.
A third proposal deals with the climate credits. Every April and October, $30 credits are applied to customers’ bills. SDG&E officials suggest combining the credits into a one-time payment of $60 that would be applied in August or September to help defray costs in the peak of summer.
A fourth suggestion centers on customer complaints over how residential baseline allowances are set. SDG&E officials said they have initiated a study to review the “climate zones” of homes and residences — coastal, inland, mountain or desert — and will file an application with the CPUC to re-examine the issue.
“We’re seeing hotter summers and we want to make sure the baseline allows customers to have the energy needed in this changing climate,” said Wes Jones, SDG&E communications manager.
Finally, utility officials will look into extending eligibility of non-tiered pricing plans — such as time-of-use rates, solar and electric vehicle programs — to a larger number of customers.
“The key is making sure there’s some equity across pricing plans to get all of our residential customers the best benefits possible,” Crider said.
The utilities commission, in an email, sounded open to hearing out the proposals.
“The CPUC appreciates the fact that SDG&E is considering ways to reduce the impacts of high bills,” said CPUC spokeswoman Terrie Prosper. “Once SDG&E puts forth its proposals, we will evaluate the best way to consider the options through a public process during which we can hear from consumers and any interested parties.”
SDG&E customer Georgiana Silvestro of Fallbrook, who complained this summer when her monthly bill reached $656, said eliminating the high usage charge “would be a good first step.”
“In this case, I think if the bad publicity (SDG&E) got brings some changes in the way they do business, who can complain?”