SDG&E Continues Focus On Rate Reform

Regulators expected to approve new electric rate structure this summer

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Mar 16, 2015, 07:31 ET

SAN DIEGO, March 16, 2015 /PRNewswire/ -- California is changing the way the state's investor-owned utilities charge customers for electricity to establish more equitable and transparent energy pricing. For more than a year, the California Public Utilities Commission (CPUC) has been evaluating changes that would help to reform electricity rates. A decision on a new rate structure is expected this summer. In the meantime, San Diego Gas & Electric (SDG&E) is educating and informing customers to make sure they're aware these changes are coming. A bill insert that describes SDG&E's rate reform proposal is included in this month's utility bills.

"At SDG&E, we recognize that reforming the electric rate structure takes time," said Caroline Winn, SDG&E's vice president – customer services. "It is our hope that rate reform will help to protect all of our customers from punitively high electricity bills by treating all customers equally, regardless of where they live, and provide more transparency on customer's bills with simpler and easy to understand bills with no hidden charges. We are encouraged that the CPUC is aggressively addressing the efforts to redesign an outdated rate structure created more than a decade ago and engaging our customers in this process, which included public participation hearings in San Diego County last September."

The CPUC has given the utilities a road map for rate design changes that is guided by core principles, making rates easier to understand, fairly charging for the services utilities provide and continuing to encourage conservation.

With these goals in mind, SDG&E filed its rate reform proposal in January 2014. SDG&E is proposing to:

Reduce the number of tiers from four to two. Shrink the difference between the top and bottom tiered prices from 136% today to 20% by 2018.
Reallocate some existing costs to a monthly service fee starting at $5 in 2015 and increasing to the approved cap of $10 by 2017. This fee would cover a portion of the cost associated with the transformer, meter, service line and billing functions. (For low-income customers, the fee would be half those proposed amounts.)
- This monthly service fee is not an additional charge or revenue source for SDG&E. The dollar amount that will be charged is embedded in rates today and will be identified in a separate line item on the bill; it's a different and more transparent way to collect SDG&E's fixed costs.
Gradually transition the California Alternate Rates for Energy (CARE) discount for low-income customers to the legislatively mandated range of 30% to 35% by 2018.
Offer new options, such as rate plans based on when customers use energy and how much energy they use at once. This can help to encourage conservation; customers will save by shifting their energy use.

For more information on electricity rate changes and ways customers can save energy and money, visit sdge.com/ModernRates.

SDG&E is a regulated public utility that provides safe and reliable energy service to 3.4 million consumers through 1.4 million electric meters and 868,000 natural gas meters in San Diego and southern Orange counties. The utility's area spans 4,100 square miles. SDG&E is committed to creating ways to help customers save energy and money every day. SDG&E is a subsidiary of Sempra Energy (NYSE: SRE), a Fortune 500 energy services holding company based in San Diego. Connect with SDG&E's Customer Contact Center at 800-411-7343, on Twitter (@SDGE) and Facebook.

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SOURCE San Diego Gas & Electric (SDG&E)