PG&E becomes California's most expensive energy provider – NBC Bay Area

On January 1, PG&E began imposing a 13% energy surcharge. The rate hike — expected to cost the average household another $33 per month — will cover the costs of burying power lines and other wildfire mitigation efforts.

But it's likely just the beginning of the pain.

PG&E filed paperwork with regulators to raise rates by another $24 per month, for the average customer, in March, to pay for storm repairs and more wildfire mitigation costs. Moreover, according to a chart PG&E recently showed shareholders, the utility indicates it intends to look for more, to recoup the billions it has already spent.

“We have a very bad problem,” said Mark Toney, president of the Utility Reform Network (TURN), a taxpayer advocacy group.

He says the company is trying to catch up on prices, having spent much more than allowed on logging and other efforts to reduce wildfires between 2020 and 2022. According to the accounting PG&E filed with state regulators during the three-year period, the company spent $9.3 billion. More than $4.7 billion has been allocated by the California Public Utilities Commission for vegetation management.

PG&E customers now pay more for energy than anyone else in California. This latest rate hike begins this week and we could see another rate hike later this year. NBC Bay Area's Raj Mathai spoke to Mark Toney of TURN's taxpayer advocacy program to get some insights.

“They have spent more than $9.3 billion and expect to collect every penny of it,” Tony said.

Tony believes PG&E will require another rate increase of $43 per month, on average, to fill the previous spending gap. This brings the total interest rate this year to $100 per month before the end of the year.

“We're talking about really huge numbers that will hurt a lot of families who don't expect another $100 a month,” Tony said.

All the raises come as PG&E plans to start issuing dividends to shareholders in 2024 — the first time since it declared bankruptcy and reorganized back in 2018. Taxpayer advocates like Tony want PG&E to get shareholders to contribute something to offset the raises. For customers.

“Last year, rates went up dramatically,” said Mike Campbell, who tracks rates for the California Public Defenders Office, the regulatory arm of the Public Utilities Commission. He says the increase in January alone is enough for PG&E to overtake San Diego Gas and Electric as the state's most expensive energy provider.

“PG&E rates have doubled — more than doubled — in the last 10 years,” Campbell said. “Unfortunately, PG&E has been the undisputed leader in rate increases for the past few years.”

Taxpayer advocates say one way to limit future increases is to force PG&E to justify them in advance.

“They have to live within their budget like everyone else, like the rest of us do,” Tony said. One way to do that, he says, is to cap spending and have utilities account for when they spend more than authorized. “You need limits on these price increases. You can't afford double-digit increases year after year after year.”

PG&E says it has had to deal with storms and other unexpected events, which have caused “significant” costs on top of what regulators allow for vegetation management. Expenditures exceed what it would have to spend to cut down 1 million trees along a 100,000-mile system of power lines to prevent wildfires.

“Every day, PG&E works to make the electric system safer and stronger for our customers in response to evolving climate challenges,” the company told us in a statement. It says this work “includes important safety work directed by our regulators” including frequent inspections of some parts of its system each year.