![]() ![]() John Thomas Scopes, and commonly referred to as the Scopes Monkey Trial, was an American legal case from July 10 to July 21, 1925, in which a high school teacher, John T. The Scopes trial, formally The State of Tennessee v. William Jennings Bryan (seated, left) is being questioned by Clarence Darrow. But it’s a big win for California and the climate.On the trial's seventh day, proceedings were moved outdoors because of excessive heat. ![]() This may feel like a loss if you are among those who will be asked to pay more. What proposed reforms would deliver is accelerated electrification and a more equitable allocation of power sector costs. We should also be pushing utilities to find ways to contain or reduce costs. Californians should be pressing the Legislature to move energy and climate policy costs out of electricity bills. The rate reforms being proposed are no silver bullet. But that view presumes that the status quo is fair when in fact the data show that it puts a large burden on those who can least afford it. Others argue that it is unfair to shift more costs onto high-income consumers. It would just change how the same amount of revenue is collected. Importantly, this rate restructuring would not raise more revenues for utilities. Some argue that this is just another example of utilities looking to increase their profits. This proposal has met with some fierce opposition. Revenues no longer recovered in a per-kWh charge will be collected in a fixed monthly charge that increases with household income, thus shifting some of the burden off of those who can least afford to pay. Per unit electricity prices would be reduced, thus reducing barriers to cost effective electrification. Research that I have done with my UC Berkeley colleagues has shown that this approach is more regressive than other taxes used to raise revenues for public investments (such as sales and income taxes).Ĭalifornia’s proposed electricity rate reform responds to both problems. Second, high electricity prices hit low-income households particularly hard because these households spend a relatively large share of their income on utility bills. But California’s grid is getting greener, so we should be less concerned about reducing electricity use and more broadly focused on encouraging people to switch away from petroleum and natural gas. Perhaps I won’t chase my kids to turn off lights they’re not using if electricity gets cheaper. You might worry that lowering electricity prices will discourage the efficient use of electricity. Research shows clearly that fewer people will choose electric vehicles or heat pumps when electricity prices are high. Increasing retail electricity prices to pay for non-incremental costs is problematic for two reasons.įirst, too-high electricity prices are a barrier to the cost-effective building and transportation electrification that is central to our climate change mitigation strategy. Other costs include transmission and distribution investment and maintenance costs, compensation for past victims of wildfires, energy efficiency programs, rooftop solar subsidies, the list goes on. One of the biggest cost drivers in recent years has been utility wildfire risk mitigation, which now exceeds $10 billion per year. Why have retail electricity prices risen so far above this incremental cost of electricity consumption? The primary reason is that California relies on high electricity prices to cover costs that do not vary with electricity consumption. When we added all the costs, including those associated with greenhouse gas emissions, we estimate that providing one more kilowatt-hour of electricity costs just 8-10 cents, not 48. Some colleagues and I have estimated the cost of providing one more kilowatt-hour (about the amount of electricity you need to run your dishwasher or cook dinner in your electric oven) to an existing customer in California. If you think these electricity prices are too high, you’re right. Since 2013, rates have increased by almost 50 percent for SDG&E customers. ![]() average residential electricity price of 16.5 cents. Households in San Diego are currently paying around 48 cents per kilowatt-hour for their electricity. To begin to understand the problem, look no further than your own electricity bill. Commentary Opinion: Does SDG&E’s call for fixed, income-based electricity rates make sense? Experts weigh in.Ī year ago, as the state Legislature rushed to pass a wide-ranging energy bill at the end of its session, it approved a huge change with zero debate. ![]()
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