Republicans Say New PG&E Pricing Will Hurt Low-Income Families

California utility companies are advocating for a controversial pricing structure that would bill households a different fixed charge depending on their income — but the idea is catching heat from Republicans who argue it will hurt low-income families.

As you may have already noticed on your own bill, monthly electric bills come with a few fixed fees that are added on top of the charges proportional to your usage rate. These charges go toward operating costs for the state’s electric grid, including maintenance.

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Earlier in April, three companies — Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric — submitted a proposal to the California Public Utilities Commission that includes an income-based pricing system for these fixed charges. According to KTLA 5, the monthly charge would vary between the companies, and range from:

• Households making less than $69,000 a year: $20 to $34
• Households making $69,000 to $180,000 a year: $51 to $73
• Households making more than $180,000 a year: $85 to $128

The companies say the rate of kilowatt-hour usage will also lower for all customers, but low-income households will benefit the most. PG&E and Southern California Edison estimate its lowest-income customers would, on average, save as much as a 21% on their bill.

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But Republican legislators are skeptical that a plan from “a government sanctioned monopoly” will save customers money. On Friday, the Senate Republican caucus fired off a letter to the utilities commission arguing that the pricing proposal would “unfairly burden” low-income residents:

• Senate GOP leader Brian Jones of El Cajon and other Republican senators, in the letter: “The goal of trying to stabilize the grid and lower electricity rates is something we support; however, the tactic of implementing a structured fixed-charge system that diminishes individual responsibility and usage in favor of an ‘identity’ subsidization is not, in our opinion, an answer. More fees are not a solution to already ridiculously high utility bills.”

The rising cost of natural gas has caused utility bills to surge, frustrating Californians across all economic levels. But lower-income residents end up paying a disproportionate share of utility expenses.

In the meantime, the first round of comments for the proposal will be due by June 2 and the Public Utilities Commission will be expected to make a final decision on the pricing structure by July 2024.

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