PG&E Seeks to Raise Rates

By Published On: August 5, 2005

Pacific Gas & Electric filed its initial salvo in seeking a rate hike at the California Public Utilities Commission August 1. The “notice of intent” to file a general rate case called for raising its base revenues by $654 million: $94 million for gas distribution investments, $485 million for electric distribution, and $75 million for new generation. If approved, the increase would raise monthly electric bills for residential customers on average by 1.6 percent and gas bills by 2.8 percent, according to the utility. It is about committing the “resources necessary so PG&E can provide great service,” said Peter Darbee, PG&E Corp. chief executive officer. Darbee said that the notice allows CPUC staff the opportunity to go through the utility’s plans before PG&E makes its official application at the beginning of December. “It is a disappointment, to say the least, to see them propose higher rates while cutting back on service,” said Mindy Spatt, The Utility Reform Network spokesperson. Spatt referred to a recent announcement that the utility will be shutting down its offices where customers can make payments in person. TURN, however, has not seen the full notice and so does not know any of its details, she added. PG&E’s 2007-09 notice of intent proposes:<ul><li>More than doubling the number of substation transformer replacements annually. <li>”Significantly expanding” its underground cable replacement efforts.</li> <li>Upgrading its hydropower facilities, which are 67 years old on average.</li> <li>Allocating additional funds to renewing and expanding hydropower licenses, which will entail new environmental and/or recreational obligations.</li> <li>Replacing old gas mains pursuant to the Gas Pipeline Replacement Program.</li></ul>In addition to investing in significant parts of its infrastructure, which the utility says are “nearing the end of their useful life and must be replaced,” PG&E said it needs to add resources to attract, hire, and train new workers as more than one-third of its employees are expected to retire during the next five years.

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