Senator Hill Introduces Legislation to Help Curb Wild Spikes in Winter Utility Bills

April 07, 2017

For Immediate Release – Office of State Senator Jerry Hill – Friday, April 7, 2017

Senator Hill Introduces Legislation to Help Curb Wild Spikes in Winter Utility Bills

Hill Proposal Would Change the Way PG&E and Other Utilities Calculate Bills
During the Coldest Season of the Year

SACRAMENTO -- Prompted by consumers’ pleas for help when confronted with soaring utility bills, Senator Jerry Hill announced today that he has introduced legislation to help curb the wild fluctuations in energy bills during winter months and to require investor-owned utilities to provide information that will help customers anticipate the amount of their next bill so they can act in time to reduce costs.

“Ratepayers shouldn’t have to live in fear of what their next utility bill will be,” said Senator Hill, D-San Mateo and Santa Clara Counties. “This legislation will reduce the likelihood of bill spikes and bring more transparency to how bills are calculated, so customers can better manage their energy use and anticipate what their costs will be for the coming month.”

Senate Bill 711 would bring more transparency and fairness to bills by:

  • Making sure that 70 percent of the bill for the average customer is covered by the lower priced, Tier 1 rates, for all winter months by changing the way baseline use is calculated. For example, currently PG&E sets the baseline at roughly 70 percent of average use by customers across the winter season. Calculating the average by that method doesn’t take into account that usage varies from month to month depending on the temperature. The legislation would make sure that more of customers’ bills in the colder months of the winter are covered by the lower rate.
  • Requiring utilities to include the expected cost of the next month’s bill in the current month’s bill so that people can adjust their energy usage or their budgeting in the coming month if their bill is likely to be higher than usual. The information is to be included in bills all year round.
  • Requiring the California Public Utilities Commission to approve the methods that utilities use to estimate bills and require utilities to post those bill estimation methodologies on their websites.

This past winter a jump in utility bills for many PG&E customers prompted complaints to the utility and the CPUC as well as calls for help to consumer-watch news programs. Senator Hill’s office also received calls, and the legislator decided to take a closer look at the problem.

An initial report compiled by Senator Hill’s staff, which was released in March, recommended that the CPUC and the utility take steps to lower customers’ bills, bring greater transparency to the way bills are calculated and help consumers better manage their energy use and its costs. The regulator and utility acknowledged the report and further response is pending.

In the meantime, Senator Hill’s staff completed a second report, which is available today. The two reports, which are linked below, form the basis for Senator Hill’s legislation to address the issues of billing fairness and transparency. Until Thursday, SB 711 was an unrelated bill, which has been rewritten to accommodate the new legislation. The new text of SB 711 was submitted to the Senate on Thursday and will be available at http://leginfo.legislature.ca.gov/ Friday.

###

Resources:

The fact sheet for Senate Bill 711 is available at this link:
http://sd13.senate.ca.gov/sites/sd13.senate.ca.gov/files/SB711_FactSheet_04-06-17.pdf

The two staff reports to Senator Hill on the billing issues are available at this link:
http://sd13.senate.ca.gov/sites/sd13.senate.ca.gov/files/Hill_CombinedBillReports.pdf

The March 2017 news release on this issue is available at this link:
http://sd13.senate.ca.gov/news/2017-03-01-senator-hill-releases-staff-report-pge-bill-spikes-calls-pge-and-utilities-regulator

Media Contact: Leslie Guevarra, 415-298-3404, leslie.guevarra@sen.ca.gov