PG&E Seeks Rate Hike To Pay For Wildfire Mitigation, Pandemic Expenses

NORTHERN CALIFORNIA — Just two weeks after the California Public Utilities Commission approved a rate increase for customers of Pacific Gas & Electric Company, the utility company has asked the commission to approve an interim rate hike as it works to recover some $1.6 billion in expenses and $0.56 billion in capital expenditures.

The proposal is contained within PG&E's Wildfire Mitigation and Catastrophic Events —WMCE—application, a 63-page document that serves as an annual request to cover a portion of the costs associated with wildfire mitigation, unplanned catastrophic events such as wildfires and storms, and other activities related to safety that are incurred beyond its general rate case. These costs exclude instances where PG&E equipment was found to have caused a fire.

A significant portion of the costs pertains to the series of extreme winter storms that occurred from December 2022 through March 2023. Each of the events was declared a disaster by state or federal authorities.

The application also seeks to recover incremental costs of approximately $26.65 million in pandemic-related customer billing protections, disconnections and reconnections —and another $5.59 million for microgrids.

"At PG&E we’re making the electric system safer, resilient to climate change, decarbonized and optimized to meet California’s needs," PG&E Spokesperson Jennifer Robison wrote Wednesday in an email to Patch. "To achieve those goals, we sometimes have to incur exceptional costs to reduce wildfire risk and/or respond to emergency events like wildfires and storms, which exceed what we’ve previously been authorized to spend in rate proceedings."

PG&E proposes to collect the interim revenue of $1.4 billion over 12 months starting in March with a 7.1 percent change for residential customers. The following year, residential rates would increase by 1.5 percent and then by 0.3 percent in 2o25.

Under PG&E's proposed timeline for a decision on the application:

• The CPUC would need to respond to PG&E's motion by Dec. 18.
• PG&E would then reply to the responses by Dec. 28.
• A draft decision or ruling would need to be completed by Jan. 8.
• That would be followed by a 15-day public comment period; and
• Final ruling Jan. 25.

If the interim revenue increase is not approved by the commission in time for it to hit customers' bills this March, PG&E says rates would go up in January 2025 by 8.9 percent for residential customers and by 0.3 percent in January 2026.

Any interim revenues would be subject to refund, with interest, if the commission's final decision on the application is a lower recovery than authorized through the interim rates.

"PG&E recognizes our responsibility to serve our customers safely and reliably, and we are aggressively focused on how to deliver work safely at a lower cost," Robison said. "We are working to keep customer costs at or below assumed inflation for the long term, between an average of 2 and 4% a year. We maintain a critical focus on wildfire safety to address the climate risk that we are facing now and the climate challenges we will face in the future."

The CPUC would not comment on the application except to say it was checking it over and that the scope and schedule for the proceeding would be posted online.

Any rate increases would be in addition to those approved Nov. 16 by the CPUC. Under that rate increase, typical residential non-CARE monthly combined gas and electric bills will rise by an average of 3.6 percent over three years. It will increase monthly bills by approximately 12.8 percent in 2024, and have a net decrease in the following years, 2025 and 2026. For example, the typical bill will increase by approximately $32.50 in 2024, $4.50 in 2025, and decrease by almost $8 in 2026.

The new PG&E rates take effect Jan. 1, 2024, however, customers may not see the change in their bill until February depending on their billing cycle.