Home | News Room | News Blog

CPUC News Blog

PG&E Electric Costs In 2016

 Permanent link   All Posts

We regulate the costs that PG&E can recover from electric customers and determine how these costs are to be allocated to various customer classes (i.e., residential, commercial, industrial, etc.). In this blog post we summarize the increases/decreases in costs that we authorized in 2016 for PG&E electric service.

Cost Changes Authorized in 2016 Vs. Cost Changes Incorporated in Rates in 2016

Many CPUC decisions (e.g., approving power purchase agreements that PG&E enters into with generators and capital investments in generating plants and transmission and distribution infrastructure) affect cost recovery over a period of years. Therefore, some changes that were put in rates in 2016 were decided by CPUC decisions issued prior to 2016. Likewise, some decisions issued in 2016 will have effect on costs beyond 2016. This blog post describes revenue requirement (the total amount of revenue needed by PG&E to pay all operating and capital costs of doing business) changes that were authorized to go into rates in 2016 and January 1, 2017.

PG&E’s total authorized electric cost recovery (i.e., revenue requirement) was approximately $14.3 billion as of January 1, 2016. As of January 1, 2017, it is approximately $13.7 billion, which represents a reduction of approximately $405 million.

 

Table A: Comparison of PG&E’s Electric Revenue Requirements on January 1, 2016, and January 1, 2017 

 

Costs Incorporated in Rates  January 1, 2016 January 1, 2017 Reduction in 2016
CPUC Jurisdictional  costs  $12,561,012,258 $12,190,081,640 $370,930,419
FERC Jurisdictional costs  $1,732,438,529  $1,698, 567,276  $33,871,253

 

 Total Costs in Rates

 
$14,293,450,787 $13,888,649,116 $404,801,672

 

The amount that PG&E needs to collect in a certain period to recover authorized costs can change depending on whether the sales level resulted in an under-collection or over-collection. Utility rates are set based on a forecast of sales. Any under-recovery or over-recovery resulting from the actual sales being different from the forecast is booked in a “balancing account”. Sometimes rates may change not because of any change in cost recovery but because of the under- or over-recovery.

The graphics below provide more information on PG&E’s electric rates.

PG&E Residential (Non-CARE) Customer Electric Rates  

 

  October 2015 - January 2017

  Tier 1 Baseline
Tier 2 101-130%
Tier 3 131-200%
Tier 4 Over 200%
Res Avg Bundled
System Avg Bundled
October 1, 2015
16.700 19.824 25.200 32.088 18.099 17.094
January 1, 2016
18.151 21.546 27.389 34.876 18.967 17.776
March 1, 2016
18.212 25.444 25.444 37.442 19.485 18.226
March 24, 2016 18.212 22.481 28.578 36.389 19.490 18.228
June 1, 2016 18.212 24.090 24.090 39.999 19.476 18.222
August 1, 2016 18.205 24.081 24.081 39.984 19.468 18.223
October 1, 2016 18.353 24.276 24.276 40.307 19.630 18.423
January 1, 2017 18.276 24.175 24.175 40.139 19.971 18.779

 

 

 

Read our most recent blog postings in the sidebar at right.


Immigration Guide