Your electric bill could go up by a few dollars if the California Public Utilities Commission approves San Diego Gas & Electric’s application for a temporary rate adjustment. The utility said the rate hike is needed because the price of electricity was higher than expected last summer.
“During the August-October timeframe, hot weather in southern California caused the market price of electricity to increase well above forecast,” reads a document SDG&E submitted to the CPUC.
Consumer advocates say they understand why the utility is filing for the rate adjustment, but say it should happen later.
“This is absolutely the wrong time for utility bills or any bills to be going up,” said Mark Toney, the Executive Director of The Utility Reform Network. “We’re in the middle of the worst public health crisis with coronavirus that we have ever seen in our lifetime.”
The filing is an Energy Resource Recovery Account trigger application. SDG&E said it is required to submit the filing when the actual cost of power is different than what it charged customers. A spokesperson told NBC 7 Responds that the filing is triggered automatically when that cost is too far off.
In documents submitted to the CPUC by SDG&E, the utility said it paid more for electricity “due to warmer than expected weather.” In those documents, SDG&E also estimates by March 2021 it will have under-collected $181 million.
These filings also work the other way. If SDG&E had charged customers more than it paid for the cost of electricity, your electric bill would go down. That’s what happened last year when the utility made a filing to reduce electric bills.
“To help minimize the impact on our customers, SDG&E is proposing to recover the under-collected revenue over a 10-month period vs. a minimum 90-day period established by the Commission,” said SDG&E in a statement to NBC7. “If approved, the rate increase would not benefit SDG&E financially, as regulated utilities in California are not allowed to make a profit from energy sales.”
SDG&E said it knows the timing is not good for many customers and is trying to spread out the collection period to reduce its impact. However, Toney said the CPUC should postpone any increases until the number of COVID-19 cases drops.
“We’re saying there should be a suspension of rate increases,” said Toney. “Hold off, defer some of these rate increases until later in the year or until next year when people can get back on their feet. Wait until businesses have reopened and people are back at work.”
SDG&E said postponing adjustments like this could make it harder for people to pay their bills because the rates would be higher than the utility is asking for in its application.
“It’s also important to understand that if we delay addressing these types of under-collection issues now, balances could accumulate and result in bigger rate increases down the road,” read SDG&E’s statement. “That’s something we want to avoid.”
SDG&E is asking the CPUC to allow it to temporarily increase rates by an estimated 3.3% to 3.7%. For most people, that would mean electric bills would increase by a few dollars each month. Toney said that still is too much because of the impact of the coronavirus pandemic.
“When you don’t know where the next dollar is going to come to pay the bills, to buy prescription medication, any amount of increase is too much,” said Toney. “Timing is everything when it comes to rate increases.”
SDG&E has information on their website if you are in a financial situation where you cannot pay your bill. You can find out more about their assistance programs here.