Pacific Gas and Electric Co. announced last week that with the start of the new year, residential customers will see a significant decline in natural gas rates, and a modest increase in electric rates. The increase is designed to cover the utility’s costs of maintaining and modernizing its system and of meeting a state mandate to buy more renewable energy, a news release said.
PG&E’s average rates for residential gas customers will dip almost 6 percent this month compared to January 2012, thanks in part to lower wholesale costs for gas. However, customers should expect an increase in gas rates of about 2 percent as early as February, reflecting spending approved this month by the California Public Utilities Commission for PG&E’s pipeline safety enhancement plan.
This plan, a comprehensive gas pipeline modernization program, will help PG&E achieve its goal of operating the safest and most reliable natural gas system in the country, the company said.
Average residential electric rates will increase about 2.6 percent systemwide compared to last January, close to the rate of inflation in Northern California, the company said. The increase is driven primarily by higher costs for acquiring clean, renewable energy to meet state mandates, and by spending previously approved by the CPUC for operating, maintaining and upgrading PG&E’s electric generation and distribution systems.
“Thanks to such upgrades, electric customers recently experienced the lowest rate of outages in the utility’s history,” the company said.
Customers likely will see another electric rate increase in May of about 2 percent to pay for additional electric transmission infrastructure to modernize California’s power grid and deliver more renewable energy to customers, the company said.
“We know our customers care more than ever about their energy bills during these difficult economic times, so we continue to focus on keeping rate increases as modest as possible while raising enough revenue to continue improving our safety and reliability,” said Tom Bottorff, senior vice president of regulatory affairs for PG&E.
“These revenues help us serve customers by reducing the frequency of electrical outages, improving the responsiveness of our call centers, providing more convenient services and, above all, continuing to upgrade the safety of our gas and electric operations. Although electric and gas rates fluctuate from year to year, our average customer bills remain well below the national average.”
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