Utility Regulators Grapple with $1B+ in Unpaid Energy Bills

11 Feb 2021

The California Public Utilities Commission is exploring options for paying off the more than $1.15 billion in unpaid utility bills that has accumulated during the pandemic.

“The numbers are pretty horrendous,” CPUC President Marybel Batjer said Feb. 11 of the arrearages for Pacific Gas & Electric, Southern California Edison, San Diego Gas & Electric and SoCalGas through the end of last year. A prohibition on gas and electric shutoffs for nonpayment of bills currently is set to last five more months, increasing utility debt further.

Source: CPUC. It noted PG&E reported number of customers while the other three IOUs reported the number of monthly non payments.

CPUC Deputy Director Ed Randolph said those ratepayers who are not financially struggling will pick up part of the tab, with the amount to be determined in a new rulemaking.

The proceeding will allow regulators “to brainstorm” on how to avoid overburdening solvent ratepayers with these costs, Batjer said. Regulators are searching for potential funding sources to fill the financial hole and looking to other states for good ideas.

Legislation passed last year allows California utilities to issue ratepayer-backed bonds to recover Covid-19 driven debt.

When the disconnection moratorium ends, some customers will face power cut offs for nonpayment, warned Rachel Peterson, CPUC executive director.

The new rulemaking will assess whether it is reasonable to provide additional relief to certain customers, to lower customer bill debt and reduce the risk of disconnection.

Disconnection freeze extended

Utility regulators also this week unanimously approved extending the moratorium on power shutoffs to the end of this June as the economic devastation of Covid-19 continues. The CPUC cast its vote before approving a controversial decision projected to increase gas-fired generation before the start of the summer.

Energy and gas disconnections were first suspended last March as job losses multiplied and people increased their electricity use at home.

The CPUC also directed the private utilities to submit transition plans that show how customers who have outstanding power bills can repay what they owe. One strategy is to waive one month of debt when another month is paid in full.

A proposed decision on the accumulated debt is expected May 21.

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