Revisions to PG&E Rate Design Approved 5-0

The California Public Utilities Commission Aug. 9 voted unanimously for a settlement that changes Pacific Gas & Electric’s rate design, largely for non-residential customers, and alters its electric marginal cost allocations.

Commissioner Carla Peterman called the decision addressing the second phase of PG&E’s general rate case “balanced.”

This week’s decision adopts what’s known as the “equal percent of marginal cost” for revenue allocation and rate design to ensure more cost-based rates.

According to the decision, this methodology seeks to assure that “those classes that impose the greatest additional (or new) costs on the utility also bear the greatest burden for the existing utility costs.” Peterman noted that rates should be based more on volumetric usage.

The decision also alters the summer peak rate for agricultural users, shifting it from 5 p.m. to 9 p.m. to 4 p.m. to 8 p.m. It sets a 4 p.m. to 9 p.m. peak period for most other non‑residential customers and shortens PG&E’s summer peak season to four months, June-September.

Regulators also updated time-of-use rates so they better align with the ebb and flow on PG&E’s grid, according to Peterman. That includes a new rate for residential and non-residential energy storage facilities to encourage charging during off peak periods.

Getting the most attention was the decision’s direction to PG&E to figure out how to increase the anemic enrollment in its low-income bill assistance program, known as Family Electric Rate Assistance. Compared to CARE, the California Alternative Rates for Energy, which has enrolled 80-90 percent of eligible customers, FERA enrollment is at a dismal 16 percent.

Commissioner Cliff Rechtschaffen said the CPUC’s Low Income Assistance Board would provide input to the PG&E on strategies to bolster enrollment, including applying unspent marketing funds. -- Elizabeth McCarthy

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Revisions to PG&E Rate Design Approved 5-0

William J. Kelly

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