PG&E Gets A Rake Hike, But Smaller Than It Wanted.

RTURN and our allies win concessions from PG&E

Rates are going up for customers of Pacific Gas and Electric Co.— but not nearly as steeply as the company originally proposed.

A far-reaching decision approved Thursday by the California Public Utilities Commission limits PG&E’s revenue increase to about $1.8 billion through 2013. That’s less than half the $4.2 billion hike the San Francisco-based utility requested at the start of a “general rate case” process that has taken nearly two years.

Consumer advocacy groups took credit for keeping a lid on the increase, saying their testimony at CPUC proceedings helped make sure things like incentives paid to PG&E executives were picked up by company shareholders instead of ratepayers.

“The settlement was good for ratepayers in that PG&E got far less than they asked for,” said Mindy Spatt, a spokeswoman for San Francisco-based The Utility Reform Network, which together with the CPUC’s Division of Ratepayer Advocates had a big hand in opposing PG&E’s larger revenue proposal.

The added revenues allowed Thursday cover various anticipated expenses associated with gas and electric distribution and power generation, including system maintenance costs.

PG&E’s senior vice president of regulatory relations, Tom Bottorff, said in a news release that the revenue increase allows the company to continue focusing on providing safe and reliable service.

“These funds are necessary to connect new customers, repair and replace aging infrastructure, and restore service during storms,” he said in the release.

Although the investor-owned utility earns various CPUC-approved incentives, PG&E makes money primarily by charging ratepayers about 12 percent interest on the money it spends keeping up its system.

It remains to be seen how the added revenues will be collected in terms of phased rate increases paid by different customer classes. That issue could take months to settle as PG&E’s general rate case enters its second phase.

PG&E said Thursday that its residential electric customers will not see any rate change this year, though its residential gas customers will be paying about 2.4 percent more per unit of energy starting June 1.

Company spokeswoman Christine Cordner emphasized that the revenue stream the CPUC dealt with Thursday accounts for only 40 percent of the costs PG&E customers pay in gas and electric rates, with the rest of the rate amount covering energy commodity prices and public benefit programs.

Included in the general rate case approved Thursday were two new reporting requirements imposed on PG&E by the CPUC.

One ordered the utility to provide semi-annual reports on its investment in distribution pipeline safety. The other calls for PG&E to produce annual reports explaining which budgeted projects were deferred or reprioritized, and why.

“The reports will help the CPUC, and other interested parties, ensure that the funds approved for these types of projects are used for their intended purpose,” the commission wrote in a news release.

Both issues arose followng the Sept. 9 PG&E pipeline explosion in San Bruno that killed 8 people and destroyed 38 homes.