Regulators Order Utility Interest Rate Decline

By Published On: December 21, 2012

The financial climate, in part, caught up with utilities’ interest rates as the California Public Utilities Commission Dec. 20 moderated high rates of return that customers have to pay for investments. “It’s a clear signal to the market to invest in California,” commission member Mark Ferron said. The state, he added, “is often perceived as ‘investor-unfriendly,’” Rate of return changes approved include: -Pacific Gas & Electric 10.4 percent, down from the current 11.35 percent;  -San Diego Gas & Electric 10.3 percent, down from 11.1 percent;  -SoCal Gas 10.1 percent, down from 10.82; and,  -Southern California Edison 10.45 percent, down from 11.5 percent. The average return on equity for electric utilities across the nation is 10.36 percent. For gas utilities it’s 9.75 percent, according to the proposed decision.  The reduction is expected to translate to savings of $2.20/month in Edison territory for utility ratepayers, down to as little as 16 cents/month for SoCal Gas.

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