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New SDG&E plan delivers lower rates to residential energy hogs, and higher rates to energy "misers"
In today's Union-Tribune, Onell Soto reports that Administrative Law Judge Thomas Pulsifer has ruled that energy "misers," who are customers of SDG&E must pay more for their electricity while energy hogs will get a 4 to 5% discount.
UCAN's Executive Director, Michael Shames, has objected to the way the rates are calculated on the grounds that they are unfair and do not reflect current economic realities.
According to the Union-Tribune, under the proposal, an inland SDG&E customer using 500 kilowatt-hours would see their monthly bills go up $2.66 to about $75.41; a neighbor using twice as much power would see a decrease of $4 to about $230, but still would have a bill more than three times as expensive.
New rates are the result of regulatory failure and botched deregulation.
The ruling is the result of a rate freeze imposed during the 2000-2001 energy crisis when consumers and some businesses were being bankrupted by artificially high electric rates. These high rates were created in part by Enron, Sempra Energy, and other big energy providers. Sempra Trading, for example, ruthlessly exploited loopholes in an unregulated market to buy energy from its affiliate company, SDG&E, at cheap rates and it then sold the same energy back to SDG&E at wildly inflated rates. Meanwhile, companies like Enron were intentionally restricting California's power supply in order to create shortages and drive up prices.
Part of the solution to reining in Sempra's manipulation of electric rates was to re-regulate electricity. The new capped rates were designed to encourage conservation and help low-income and low-use ratepayers. The new rates capped the cost by maintaining lower rates for households that conserve, while also raising rates for households that use more energy, thereby encouraging conservation.
Capping rates was only part of the solution
Part of California's energy problem was that the state was held hostage to out-of-state suppliers of natural gas and electricity. The solution was to generate our own local energy using wind and solar power. However, these "green" alternatives cost more per KwHr than traditional sources of electricity. As a result, California is more energy independent, but rates have climbed, too. Thanks to the rate caps, which were meant to be temporary, the rates for residences that used more electricity increased exponentially, while the rates for energy "misers" stayed, well, "miserly" with allowable rate increases of 3 to 5% a year. The changes are meant to gradually bring electric rates in line with the realities of real-world supply and demand.
Calculations used to apply the rate hikes are unfair.
UCAN's Michael Shames says that the rate increases should be tied to today's relatively low rates of inflation. In the article, he calls the new rates "ridiculous" saying that the 5% increase recommended by Judge Pulsifer is "patently unfair."
UCAN argues that rate increases should be 3% (the legal minimum) rather than 5% (the legal maximum).
" People didn’t get cost-of-living increases this year," says Michael Shames, "so utilities should follow suit."
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Public Purpose Programs Fee
You might want to take a look at the details of your electric bill. In 2009 I paid SDG&E $4,958.77 for electricity alone (2500 sq ft/ 3 adults). Of this amount $1,358.83 was not for electricity but for "Public Purpose Programs". That is a 27% tax!!! The definition of this fee leaves a lot to be desired because it doesn't really say what the money is used for or who doles it out. I'm sure that we don't get any say in this. When I asked SDG&E they said it was set by the PUC. The PUC agent has not returned my calls. Oh yeah, the basic electricity allowance for my house wouldn't even run my refrigerator and computer for the month.
I Remember When . . .
I remember when my 1160 sqft home with 4 people cost about $65 per month to run both gas and electricity. Today, same square footage, same number of people, and I'm lucky to keep it under $300 since the infamous 'deregulation' debacale. We use less now than back in the '90s, but paying a heck of a lot more. What's wrong with this picture???
I wish I could afford to install independent means of energy (i.e., solar) but that's financially out of my reach.
I'm also hit with skyrocketing water bills. There's a device made in France that can pull water out of the air that's being tested in 3rd world rural areas with success. Wish I could install that and just stop the water bill.
I'm paying about $300 to $400 per month now for utilities (gas, electricity, water) than 20 years ago. Water bill use to be $40 every other month back then.
Com'on! we're all going broke out here!!!
How do you define "residence"?
As the person posting "energy hog" up above stated, the way SDG&E allocates electricity is a joke. I am also an "energy hog" by their definition. I have lived in my current home 14 years, have spent thousands on efficiency improvements, and cut my monthly average usage by more than 20% per year. Yet, I have seen my rates more than triple over the same time. I do not use A/C EVER - and have gas heat. We walk around most of the time at night like we're in a blackout our house is so dim.
There are four people living in my four thousand square foot home. If instead, the same four people were living in four separate one thousand square foot one-bedroom apartments, and used the SAME AMOUNT OF ELECTRICITY per month, suddenly they would pay 50% the aggregate price for their electricity, and they would become "misers". LOL! Where do I sign up?
So why the arbitrary definition of a "household"? What this basically means is that families and home-owners pay more for their electricity (sometimes MUCH more) and singles and apartment dwellers pay less. If two people live together, and use, for example, 150% of the electricity of a single resident (thereby saving 50% of an average monthly usage) they are penalized. Far better for them to each use 100% of their allocation!
Because there is no way for SDG&E to determine size of household, or number of consumers per household, there is no way for them to really understand their own market. Their entire rate structure is based on incomplete information. If one "household" uses twice as much electricity as another, can they really pretend to understand anything about what that means?
Energy hogs
I resent being called an energy hog simply because I live in a modest-size house and have a lot of people living in my home. Just because we use 1,000 kWh per month (on average) doesn't mean we are wasting energy. In fact, every time there is talk about reducing energy, I wonder where I am going to be able to cut. We have ALWAYS tried to conserve energy, but seven people (including retired people who are home all day) use energy. I already have my thermostat set to 68 degrees in winter and we wear jackets and sweaters in the house. In summer we try hard NOT to use the A/C but one person is adversely affected by temperatures above 78 degrees.
What *I* think is unfair is that my 7-person, 2,000-sqft home has the same baseline rate as 1 person living in a 900-sqft home.
"Realities of Real-world Supply and Demand"
Since when has Sempra Energy and SDG&E been concerned with "real-world supply and demand"? Aren't these the same companies who manipulated the cost of electrical power to extract hords of cash from their customers during the energy crisis at the start of this decade?
Hmm... they want what's fair after being unfair. They want rates in line with the realities of real-world supply and demand, when they distorted such before.
Here's a real-world supply and demand scenario for you, Sempra/SDG&E: We demand honesty, truth, and fairness; you supply it. Until I'm convinced you're business represents that, I further say that the money made (stole) during the last 'crisis' should suffice you for quite a while longer.
For the Judge: You should be ashamed.
"Realities of Real-world Supply and Demand"
Since when has Sempra Energy and SDG&E been concerned with "real-world supply and demand"? Aren't these the same companies who manipulated the cost of electrical power to extract hords of cash from their customers during the energy crisis at the start of this decade?
Hmm... they want what's fair after being unfair. They want rates in line with the realities of real-world supply and demand, when they distorted such before.
Here's a real-world supply and demand scenario for you, Sempra/SDG&E: We demand honesty, truth, and fairness; you supply it. Until I'm convinced you're business represents that, I further say that the money made (stole) during the last 'crisis' should suffice you for quite a while longer.
For the Judge: You should be ashamed.
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