Why are PG&E Rates rising?
PG&E Rates Could Skyrocket. Have you seen this headline? Is your bill higher than it was this time last year? What is going on?
OK, first things first, ask yourself… have you changed up your household patterns? Did you install a hot tub or spa, or add an electric car to the household? Here is a list with more questions around household list. (Fun fact: As a SmartSolar company, we have a pretty ingenious app that will let you see what in your house is using and how much!)
But let’s be frank. Our largest statewide provider, has gone to the CPUC (California Public Utility Commision) for permission to raise rates both *before* and after the devastating wildfires and resulting lawsuits from last year. While its not exclusively because of these, PG&E has issues with legal liabilities and executive compensation. So, let’s look at how these might impact you, as well as the Time of Use changes being rolled out to us all this year.
Are the California Wildfires causing high electricity prices?
Not entirely. According to their filings (commented on by San Jose’s Mercury news ) PG&E put in a proposal for funds that would go bolster wildfire prevention, risk monitoring, and emergency response efforts, add new and enhanced safety measures, increase vegetation management, and harden its electric system and funds to reduce future wildfire risks.
In addition, there are costs associated with shutting down aging nuclear power plants.
But, the two years of wildfires, the lawsuits, the bankruptcy proceedings? Yes, these items were presented to the CPUC as justification for additional rate hikes, though you won’t see them called out as surcharges.
Is PG&E Executive Pay causing rate increases?
Despite presiding over far-ranging uncertainties arising from deadly wildfires in Northern California, there was widespread indignation in response to news that PG&E’s top boss captured a hefty increase in total compensation during 2017, according to the regulatory filings. In 2017, Geisha Williams, PG&E’s chief executive officer, was awarded $8.6 million in total direct compensation, according to a PG&E filing with the Securities and Exchange Commission. Her 2017 pay package was 106 percent higher than the $4.2 million in total pay she received in 2016.
Again, there is no surcharge that is labeled “for executive compensation” and while it may be a very small percentage of the companies expenses, it is one that leads customers to believe the company is not well run.
Is Time of Use part of the problem?
Likely. Short answer, TOU was introduced in 2016 and becoming mandatory for all in 2019. It makes energy cost less during times of day when energy is in low demand, such as late night, early morning and mid-day.
But while PG&E’s explanatory pages make it seem as though this could help you save money by adjusting your schedules, make no mistake… it will end up costing you more. Can you imagine turning off the lights and leaving the dishes unwashed in the evenings? Can we do our laundry between midnight and 5am? Moving everyone to this system will enable PG&E to bring in more revenue, at our expense.
It is unlikely that anyone would be able to change their lifestyle enough to benefit from these lower priced times of day.
In conclusion, PG&E has issues that will not be getting better anytime soon, but you have options. We are happy to help you learn what generating your own electricity would look like and to answer any questions – no sales pressure!
If you’re curious if solar would be a good fit for your home, read our 5 point checklist.