OAKLAND — PG&E is seeking a fresh increase in monthly bills — yet again — for its residential customers, this time to help the utility titan meet demand for new housing, commercial real estate and healthcare projects.
The latest proposal would produce an average increase of $4.33 a month for PG&E residential customers who are not on any subsidies, according to an estimate provided by PG&E officials.
For lower-income residential customers who are on subsidiaries, monthly bills would increase by $2.81 a month.
This works out to an increase of as much as 1.8% compared with existing bills.
The utility behemoth’s bills have zoomed higher at a pace that’s several times faster than the overall Bay Area inflation rate.
Oakland-based PG&E envisions an array of uses for the additional revenue the proposal would produce, according to the regulatory filing with the PUC, which under California law is supposed to regulate the power company.
“The additional funding will enable PG&E to connect more than 13,000 new customers to the grid in 2024, compared with 9,800 new customers in 2023 and 8,000 new customers in 2022,” PG&E spokesperson Mike Gazda said.
The utility hopes the additional revenue will help it eliminate order backlogs, complete customer connections more quickly, improve electricity grid performance and reduce carbon emissions.
“PG&E will recover costs only for what it spends,” Gazda said. “The PUC will review spending to ensure it is just and reasonable.”
The utility believes upcoming demand for numerous new projects — at a time when the office, hotel and retail markets have developed — will further drive the need for additional revenue to complete more connections.
“The capacity work we plan to complete in 2025-2026 with increased funding is necessary for housing projects, electric vehicle charging stations, high-speed rail construction, data centers, internet-order delivery hubs, commercial redevelopment projects, and local infrastructure such as hospitals and water treatment plants,” PG&E stated in the regulatory filing with the state PUC. Amazon centers could be in this group.
PG&E argued in the regulatory filing that all customers would “broadly benefit” from the increase in monthly bills and increased revenue flows.
“Without additional funding, these benefits will either not occur or will be greatly reduced,” PG&E stated in the regulatory filing.
The utility leviathan is seeking to raise previously authorized caps that had been imposed by the PUC on what PG&E could spend on these kinds of projects and endeavors.
“This is going to benefit new home buyers, as well as people who are making upgrades to their homes such as installing solar,” said Lynsey Paulo, a PG&E spokesperson. “It will benefit residential as well as business customers.”
The utility maintains that it has been making steady progress already in improving its connection efforts.
Among the benchmarks that the company offers:
— In 2023, PG&E’s completed more than 9,800 connections, up from 8,000 in 2022 despite brutal storms that roared through California during the first three months of last year.
— PG&E hopes to complete 13,000 connections by the end of 2024.
— The average time from application for a connection to completion of the project decreased by 50 days, a 13% decrease.
— The backlog of design work in progress decreased by 30%
In 2023, PG&E’s monthly bills for residential customers soared 22.3%. Over the same 12 months, the Bay Area inflation rate rose 2.6%.
In October, Gov. Gavin Newsom, a Democrat, issued an executive order that he hopes will curb skyrocketing electricity bills paid by customers of PG&E and other California utility behemoths.
By what happens, Newsom appointed all five members of the state PUC who have approved a string of higher monthly bills for PG&E. The state Senate, the majority of whose members are Democrats, confirmed all five of the governor’s appointments.
A consumer group blasted this latest quest by PG&E to generate more revenue in a fashion that causes monthly bills to rise.
The Utility Reform Network urged the state PUC to deny PG&E’s request to drive up customers’ bills. TURN estimated that the increase equals to $3 billion in proposed additional spending by PG&E.
TURN also pointed out that in January 2024 the state PUC approved an interim increase in revenue — and monthly bills — to cover an already existing backlog of customer connection requests.
The consumer group criticized the request for more spending on the heels of the temporary increase in monthly bills.
“PG&E’s request would add to the burden on ratepayers who are already facing record-high utility costs and affordability challenges,” TURN officials stated.
The utility believes it makes sense to pursue efforts to expand the total customer base by speeding up connections and upgrades.
“Adding thousands of new connections will help spread fixed grid operations and maintenance costs across more customers,” Gazda said.