Investigatory hearings into “outrageous profiteering” by electricity providers and a look into the “dysfunctional” structure of the market could top some of the moves made by the California Public Utilities Commission (CPUC) when it meets next month to discuss San Diego’s high utility rates.
That’s according to CPUC Commissioner Carl Wood, who was in town July 18 to discuss what the commission was doing about San Diego’s electricity rates. Those rates climbed from 3.25 cents a kilowatt hour in April to a peak of 13.48 cents a kilowatt hour July 15. Prices fell slightly last week, to 13.41 cents.
The commissioners would take up the matter at their Aug. 3 meeting. Wood declined to say exactly what the commission would do, since he was one of five members of the panel. But it was likely that these investigations would top the list, he said.
The CPUC will also discuss granting San Diego Gas & Electric Co. broader authority to engage in “hedging,” or buying electricity through long-term contracts. The utility made a request for broader authority to hedge electricity purchases, thereby locking in rates, he said.
But hedging is a double-edged sword, because if SDG & E; guesses wrong, its customers are locked into higher prices. The CPUC needs to look at the matter carefully, so the utility has an incentive to hedge well, Wood said.
The commission most likely will not follow through on a proposal from state Sen. Steve Peace, D-El Cajon, to grant the governor emergency powers to site utility plants and transmission lines. Although the relative scarcity of electricity is a factor in high prices, Wood remains wary of granting the governor such power, he said.
One thing the CPUC will not do is act to freeze rates. The commission released a decision last week denying Utility Consumers’ Action Network’s July 6 request to reimpose a rate freeze against SDG & E.;
Whatever move the CPUC makes at its Aug. 3 meeting, the decision will go into effect almost immediately, Wood said. He conceded the commission will be under additional pressure to get something done at that meeting, since the second meeting in August is traditionally cancelled to give commissioners a summer vacation.
Kyle DeVine, spokeswoman for the CPUC, said SDG & E; customers will be seeing relief from high utility bills in the months ahead.
She said $100 million in unforeseen revenues from electricity generation at the San Onofre Nuclear Generating Station will be passed on to the customers in the form of a credit on their utility bills, she said.
The average residential customer will save $17.25 a month for the next two months, DeVine said.
That is in addition to a CPUC-approved refund scheduled for next month. The average residential customer will get a refund check for about $260 as part of a $390 million rebate approved by the commission, DeVine said.
Michael Shames, meanwhile, warned utility customers not to be fooled by these sudden rebates. The executive director of the Utility Consumers’ Action Network (UCAN) said SDG & E; was engaging in a “shell game” by raising rates on the one hand and then providing rebates with the other.
Shames also urged utility customers to vent their frustration with the CPUC and the governor, demanding they not wait until Aug. 3 to take action. He’s scheduled a demonstration July 26 in front of the local CPUC office at 1350 Front St.
UCAN is inviting SDG & E; customers to stop by and burn their July bills. The “controlled slow burn” will start at noon and continue until San Diego ratepayers get relief, he said.
