​SCE Rates Rise as Utility Wants to Spread the Pain

LED Info

Jun 19, 2014, 11:37am PDT
Scott Bridges

A friendly piece of advice for Southern California Edison customers: Check your budget before cranking up the air conditioning this summer.

Last week, the state Public Utilities Commission last week approved a rate increase for the nearly 5 million SCE customers — an average surge of 8 percent, according to the Daily Breeze. To what do we owe this price increase? SCE rates expert (as the newspaper terms him) Russ Worden chalked it up to a sharp spike in natural gas prices back in January when it got really cold elsewhere in the country, combined with the first restructuring in more than a dozen years in the way residential utility bills are calculated.

“Natural gas prices were sharply higher in the first half of this year than anybody expected,” Worden told the Daily Breeze, while adding that California imports about 85 percent of its natural gas.

A friendly piece of advice for Southern California Edison customers: Check your budget...


“The second part” of the rate increase, Worden said, “is an initial step in a broader rate reform policy change on the part of regulators and the electric utilities. So the initial step in rate reform plus the [low] estimates in natural gas prices have pushed costs upward.”

Worden said that Edison is letting the consumers foot the bill for the higher costs. About half of those consumers will owe an extra $8 monthly.

Even half of the the utility’s low-income customers who qualify for California Alternative Rates for Energy (CARE) will see their bills shoot up about $5, he said.

To make matters worse, Edison’s new method of calculating residential electricity bills will tack on an additional 1.5 percent price hike across the board next year, according to the report.

Here’s why: Edison is proposing a two-tier system that would replace the five-tier rate structure that was instituted in 2001. That five-tier structure, Worden said, was implemented to encourage energy conservation, and has resulted in virtually zero change in monthly bills for customers who conserve.

However, customers who crank up the air in the summertime have, obviously, seen their bills resultantly reflect that. The new system would spread those costs so that everyone shares the tab, or as Worden says, “Edison is now proposing to smooth that out … by increasing the flat rate customers now pay.”

“We’ve proposed a $10 (flat) charge that every customer would pay regardless of where they live,” Worden said.

Notice the last part of that statement: “where they live.” Worden goes on to say, “you wouldn’t see the big jumps in bills that customers in Riverside

County and San Bernardino County see in the summer months.”

Let’s be honest about what this is: Customers who choose to live in outlying communities with hotter climates — like those desert counties — have to turn their homes into ice boxes to avoid the triple-digit heat outside, whereas many Westside homes do not even have air conditioning. One consequence of living in an inhospitable climate is that home prices and rents are cheaper. In fact, just about everything is cheaper.

So if one chooses the “cheap” option of living in an inhospitable part of the world — one that intelligent humans have historically shunned — one should expect secondary costs associated with such an affront to civilization, such as the enormous energy costs required to build the war machine to invade foreign lands for the purposes of extracting the fossil fuels necessary to supply the energy that makes such an existence tolerable, for instance.

The PUC is expected to decide on the spread-the-pain proposal next spring.

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