California Climate Credit - Frequently Asked Questions

The credits come from a State program that requires power plants, natural gas distributors, and other large industries that emit greenhouse gases to buy carbon pollution permits from auctions managed by the Air Resources Board. The credit on your electricity bill is your share of the payments from the State's program. 

Each year the state auctions a limited number of emission permits so that California can meet its goal of reducing its overall emissions down to 1990 levels by the year 2020. Some of the auction proceeds are used by the state to fight climate change, and some are returned to many Californians as a Climate Credit. This program is one of many developed as a result of the Global Warming Solutions Act of 2006, which put California at the forefront of efforts to battle climate change. 

We created the credit program, and we also oversee the program’s implementation. The money is from the State, not from the utility, even though the utilities deliver the credit on the State's behalf. See our page on the Cap-and-Trade Program for more information.

Check out our page dedicated to the Greenhouse Gas Cap-and-Trade Program.

Yes, California has various programs to reduce greenhouse gas (GHG) emissions, one of which is the Cap-and-Trade Program. Electricity providers face GHG costs when they produce electricity from fuels that put GHGs into the atmosphere. Natural gas utilities face GHG cost associated with their deliveries of natural gas to customers. These costs will be reflected in your bills - in generation rates for electric customers and in transportation rates for natural gas customers.  The twice-annual California Climate Credit will help to offset bill increases.

The California Global Warming Solutions Act of 2006, or Assembly Bill (AB) 32, is California’s law to reduce carbon pollution and fight climate change. AB 32 mandates that California reduce its greenhouse gas (GHG) emissions to 1990 levels by 2020, and then maintains that reduction (about 15% from current levels).

The lead agency is the California Air Resources Board (ARB). This is also the agency that sets state standards to clean the air and promote clean vehicles and clean fuels.

You receive a separate California Climate Credit for both your electric and your natural gas purchases. Currently, all residential electricity customers of the following companies receive the electric credit: 

• PG&E

• SDG&E

• SCE

• Pacific Power (PacifiCorp)

• Liberty Utilities (CalPeco Electric)

• Bear Valley Electric Service

• All Community Choice Aggregators (CCAs) 

If you use the following companies for natural gas, you will receive the credit:

• PG&E

• SoCalGas

• Southwest Gas

• SDG&E 

If you receive services from both an eligible electric and an eligible natural gas service provider, you will receive both credits. You don't need to do anything to receive the credit - it is automatically applied to your bills. The credit amounts vary among utilities and from year to year but are not related to the amount of energy you use.

Residential households: 

The electric California Climate Credit is applied twice per year in the spring and fall - for most customers, it will be on your April and October bill. SDG&E customers will receive the electric credit in August and September through 2022. The natural gas California Climate Credit is applied once a year in April. SDG&E natural gas customers will continue receiving the natural gas California Climate Credit in April.

Small businesses: 

The electric small business California Climate Credit is distributed at the same time as the electric residential California Climate Credit. There is no natural gas small business California Climate Credit. For PG&E customers in 2022, the Small Business California Climate Credit will not be distributed in April, and recipients will instead receive a double credit on their October bill.

Billing periods vary by utility and may not always coincide with a calendar month. If you don't see a credit when you expect it, it should appear on the following month's bill. If it doesn't, contact your utility.

The California Climate Credit is a bill credit that is part of California’s efforts to fight climate change. The credit is from a state government program that requires power plants, natural gas providers, and other large industries that emit greenhouse gases to buy carbon pollution permits from auctions managed by the Air Resources Board. The credit on your electricity and natural gas bills is your share of the payments from the State’s program.

You are receiving the credit because you are a customer of a utility or CCA regulated by us, and the credit is a program that we created. You don’t need to do anything to receive the credit. It will automatically appear on your bill.

Households are receiving the California Climate Credit to protect them from cost increases and to provide more opportunities to take advantage of energy and money-saving upgrades that also help fight climate change.

You will see the following:

• A line item “CA Climate Credit” or “California Climate Credit” on your bills with the credit amount.

• A bill message briefly explaining the credit.

All eligible active electric customers usually receive the credit in the spring (April) and fall (October). If you’re an SDG&E customer, your electric credits will arrive in August and September. If you don’t see the credit on your bill, the first thing to do is contact your utility.

While you can always contact CPUC if you have concerns or questions, we suggest you try your utility first. That is because your utility can directly access your records, tell you whether you're receiving the credit, and correct any errors directly.

Submetered customers should receive the California Climate Credit.

Yes, but the California Climate Credit is distributed equally to each electricity provider’s residential customers, regardless of energy consumption or bill amount. In other words, Southern California Edison customers receive a different amount of credit than San Diego Gas & Electric customers do. But all residential customers of Southern California Edison receive the same amount.

No, all residential and small business customers of the same electric utility will receive an equal amount in credit regardless of the amount of energy they use. Whether you receive a credit or how much you receive is not connected to the amount of energy you use. Customers receive this credit as your share of California’s Cap-and-Trade program.

Any carryover balance will be applied to your next month’s bill. If there is a balance, customers may ask for a refund check instead of having the balance applied to your next month’s bill.

Each year, each investor-owned utility forecasts that total amount of allocated allowance auction proceeds it anticipates receiving from the Cap-and-Trade Program for the upcoming year. After administrative and outreach expenses, spending on clean energy and energy efficiency programs, and California Industry Assistance is deducted, the remainder is split evenly across each residential household and qualifying small business. Since investor-owned utilities began accruing proceeds in 2012 through 2020, residential and small businesses have received over 85% of the total electric proceeds. 

The most cost-effective way to return this credit to customers is as a bill credit through your energy provider. This approach maximizes the amount of savings each household and small business will receive.

Right now, the California Climate Credit is expected to continue through 2030, although this may change.

Yes. The size of the California Climate Credit depends on variables that change from year to year, but the credit will always be calculated according to rules established by CPUC.

Here are a few useful links:

• General information:  California Climate Change Portal
• California Air Resources Board Climate Change Page
• California Air Resources Board AB 32 Scoping Plan

Households and small businesses receive the California Climate Credit. You will automatically receive the California Climate Credit if you receive electricity from an investor-owned utility company, electric service provider or community choice aggregation provider (CCA) and are receiving utility service during the period the Credit is distributed.

Residential households: 

If you are a California residential customer from the following companies, you are eligible to receive the credit:

• Pacific Gas and Electric

• San Diego Gas & Electric

• Southern California Edison

• PacifiCorp 

• Liberty Utilities 

• Bear Valley Electric Service

• All community choice aggregators (CCAs)

Residential customers can receive credits for both their electric and natural gas purchases. All submetered customers are eligible for both credits.

Small businesses:

If you are a small business customer from the following companies, you are eligible to receive the credit:

• Pacific Gas and Electric

• San Diego Gas & Electric

• Southern California Edison

• PacifiCorp

• Liberty Utilities 

• Bear Valley Electric Service

• All community choice aggregators (CCAs)

Small business customers are commercial, industrial, or agricultural customers that typically use less than 20 kilowatts (kW) of maximum power in a month. If you are a nonprofit organization or school, you also qualify. You are eligible if your power demand hasn't exceeded 20 kW more than three times in the last year. For Liberty Utilities customers, eligibility is calculated on a calendar-year (rather than rolling) basis.

If you're not sure whether you're receiving the California Climate Credit, the first thing to do is contact your utility or CCA, the same as you would do with any billing questions. That's because although CPUC oversees the credit and can help with any remaining questions you have, your utility or CCA is best positioned to access your individual records and answer questions about your account.

Yes, If you are a NEM customer or have solar and/or an electric vehicle, you will receive the credit. The credit goes to all residential electricity and natural gas customers. Having solar does not affect your credit either way.

Yes. If you live in a mobile home or any “master metered” arrangement where your landlord receives the utility bill directly, you are eligible. The landlord that receives the utility bill must pass on the electric and natural gas California Climate Credits to you as their tenant. The utilities provide information to landlords or master meter customers to make sure they know how much California Climate Credit to return.

Yes. If you are a residential electric or natural gas customer of the following participating utilities you will get the credit.

Electric provider:

• PG&E

• SDG&E

• SCE

• Liberty (CalPeco Electric)

• Pacific Power (PacifiCorp)

• Bear Valley Electric Service

Natural gas provider: 

• PG&E

• SDG&E

• SoCalGas

• Southwest Gas

All community choice aggregators (CCAs) customers should also receive the credit.

Yes. All eligible accounts get the credit.

Customers of public utilities (like Sacramento Municipal Utility District (SMUD) and the Los Angeles Department of Water and Power (LADWP)) don't get the California Climate Credit because the CPUC does not regulate public utilities. The California Climate Credit is a CPUC-established program, and it only applies to the investor-owned utilities we regulate.