PG&E gouging its customers?

[Steve C]

JPM.... in a logical world, I would agree with you. However, as we don't live in a world of logic, I will have to respectfully disagree. I will point to the numerous examples of water rates increasing for users as they have conserved during the most recent drout. There are all kinds of newspaper reports discussing this matter.

I know I'm sounding as if I'm bitching, but I'm rather just trying to make a point...as wrong as it may be.

[DanKegel]

JPM.... in a logical world, I would agree with you. However, as we don't live in a world of logic, I will have to respectfully disagree. I will point to the numerous examples of water rates increasing for users as they have conserved during the most recent drout. There are all kinds of newspaper reports discussing this matter.

You're both right.
The way to cut your water bill under these conditions is to *conserve more than your neighbor does*.

Rate design is hard. Consider:
1. You want to put some of the fixed costs into the per-usage rates; this encourages conservation, and gives people on a tight budget (like Grandma) a way to cut their bills by using less water.
2. In a drought, you want rates to go up to provide an incentive for people to conserve.
Those two things together mean that people who bust their ass to conserve can still see their bills go up... but their neighbors go up a lot more.

An alternate approach, in which all costs of operating the water network are put on a fixed part of your bill that's the same for all customers, would avoid the problem you're talking about, but would lead to angry or cut-off low-budget customers and huge water use by everyone else (since once you've paid the huge fixed bill, and the per-usage rates are so low, you feel entitled to use lots of water).

[J.P.M.]

You're both right.
The way to cut your water bill under these conditions is to *conserve more than your neighbor does*.

Rate design is hard. Consider:
1. You want to put some of the fixed costs into the per-usage rates; this encourages conservation, and gives people on a tight budget (like Grandma) a way to cut their bills by using less water.
2. In a drought, you want rates to go up to provide an incentive for people to conserve.
Those two things together mean that people who bust their ass to conserve can still see their bills go up... but their neighbors go up a lot more.

An alternate approach, in which all costs of operating the water network are put on a fixed part of your bill that's the same for all customers, would avoid the problem you're talking about, but would lead to angry or cut-off low-budget customers and huge water use by everyone else (since once you've paid the huge fixed bill, and the per-usage rates are so low, you feel entitled to use lots of water).

Dan: Another example of your arrogant hubris. Since when did you become the arbiter of rightness, or wrongness or, for that matter anything in between ? You are one of the last people on this planet to judge the rightness or wrongness of my statements and opinions. I believe Steve C and I have a difference of opinion. I believe I understand his position without your input. Your imprimatur of my opinion is something I do not need.

Consider trying this: Add "I think", or "IMO" to your statements before they turn into what sound like commands or edicts.

BTW, when did you become knowledgeable about rate design, if at all ? More of the world according to Dan ?

What you speak of with respect to rate design starts as a matter of common sense.

[Kuma]

.... You don't pay for what you don't use, nor do you pay more for non use on an increase. ...

This has changed and will most likely continue to change. NEM 2 requires a daily service charge, $10-$11 a month. And a $145 solar service connect fee.

[Sunking]

It is not PG&E gouging you, it is your state failed energy policies screwing you over.

[sensij]

This has changed and will most likely continue to change. NEM 2 requires a daily service charge, $10-$11 a month. And a $145 solar service connect fee.

That is a minimum bill, not a fixed service charge. It was reapproved by the statewide rate reform, not net metering. It applies to all customers, not just solar.

NEM 2 did establish a fee for new solar interconnects.

[sensij]

It is not PG&E gouging you, it is your state failed energy policies screwing you over.

The state's energy policy is responsible for executive pay? That is what the OP's link was about.

[J.P.M.]

It is not PG&E gouging you, it is your state failed energy policies screwing you over.

Because I'm a cynical realist, I'm not sure I see a connection between executive compensation and rate tariffs, or exec. comp. w/much of anything w/respect to PUC membership most anywhere except the good ol' boy network and the ability to suck a golf ball through a garden hose.

[Sunking]

Because I'm a cynical realist, I'm not sure I see a connection between executive compensation and rate tariffs, or exec. comp. w/much of anything w/respect to PUC membership most anywhere except the good ol' boy network and the ability to suck a golf ball through a garden hose.

Exec pay has nothing to do with PUC directly, but it does factor into the rate. It is hidden from the rate payers just like Net Metering losses are added into the rate.

Exec pay just like management and labor are factored into the rates. The PUC has no say on salaries or hourly wages, but is factored into the O&M cost, and the utilities are guaranteed a rate of return by the PUC. Exec salaries are determined by the Board of Directors not PUC.

Fair enough?

Edit Note:

JPM i remember about 30 years ago I was working for an electric utility in Oklahoma (PSO) which at the time was owned by Central and Southwest Power out of TX. I was a Sub-Station and Transport train driver. All of were called to a meeting in Dallas right after a huge layoff of Tx utility company workers, and deregulation of electric utilities in TX. Iwa was still young and dumb full of come. I digress.

Anyway I was thinking how horrible and unfair the deregulation was on utilities, stock owners, employees, and the rate payers. So during Q&A time I rose my hand and asked how could this be a good thing for anyone? The execs just laughed at this idiot who just asked a very stupid question.

The CEO put up a few slides on the Overhead Projector. First was Stock Price had shot up 20% in a week which is unheard of for utilities, second slide which had not been released to the public as of yet were the 3rd party resellers price list and the rates were 20% less than what the utilities charged. How could that be? So the CEO said hey stupid; 35% of our operating cost is BILLING and keeping track of accounts. We just eliminated all that cost and the employees. We no longer have unpaid accounts. Everything is wholesale to the 3rd party vendors who pay every month on time for every Kwh they consume.

Damn I learned that day I was young, dumb, and full of come. I became a man that day, and learned how to manage and invest money. Pass the risk down to smaller more efficient vendors. All those laid off employees became the vendors and got rich. That happened to me when the Telecom went bust and I got laid off. I made my own company and continued to do what I did before making a lot more money while saving the company I worked for even more money. Survival my friend.

[reader2580]

The problem is that I as a consumer can only cut my electricity usage down to a certain point before there is nothing more to give unless I want to live like someone in the 1800s. I've already done all the easy stuff like convert all light bulbs to LED and so on. House has had all kinds of energy conservation work done to conserve energy.

The state requires the utility companies to promote energy conservation by giving rebates on energy saving HVAC, water heaters, and lighting. The utility companies then file for rate increases with the PUC every year and every year they state they need to raise rates because they are selling less due to conservation.

[Sunking]

The problem is that I as a consumer can only cut my electricity usage down to a certain point before there is nothing more to give unless I want to live like someone in the 1800s. I've already done all the easy stuff like convert all light bulbs to LED and so on. House has had all kinds of energy conservation work done to conserve energy.

The state requires the utility companies to promote energy conservation by giving rebates on energy saving HVAC, water heaters, and lighting. The utility companies then file for rate increases with the PUC every year and every year they state they need to raise rates because they are selling less due to conservation.

Have you ever wondered why many states charge less than 10-cents per Kwh for the first 2500 Kwh you use in a month, and even less if they use more than 2500 Kwh/month? Why is that? Some people pay s little as 6-cents per Kwh. Why do you pay so much?

The answer is stupid simple. As stupid as the question; Who is buried in Grant;s Tomb?

[reader2580]

Have you ever wondered why many states charge less than 10-cents per Kwh for the first 2500 Kwh you use in a month, and even less if they use more than 2500 Kwh/month? Why is that? Some people pay s little as 6-cents per Kwh. Why do you pay so much?

I pay a flat rate of around 12 cents per KWh which I don't think is crazy, but it went up over 15% on Jan 1. It is higher than some areas and a lot less than other areas. My bill is $66 a month on a budget plan.

Some areas instead of charging less for more KWh they charge significantly more for more usage. In those areas with high air conditioning usage it is nearly impossible to stay out of the higher tiers unless you don't use the air conditioner.

[J.P.M.]

Exec pay has nothing to do with PUC directly, but it does factor into the rate. It is hidden from the rate payers just like Net Metering losses are added into the rate.

Exec pay just like management and labor are factored into the rates. The PUC has no say on salaries or hourly wages, but is factored into the O&M cost, and the utilities are guaranteed a rate of return by the PUC. Exec salaries are determined by the Board of Directors not PUC.

Fair enough?

Edit Note:

JPM i remember about 30 years ago I was working for an electric utility in Oklahoma (PSO) which at the time was owned by Central and Southwest Power out of TX. I was a Sub-Station and Transport train driver. All of were called to a meeting in Dallas right after a huge layoff of Tx utility company workers, and deregulation of electric utilities in TX. Iwa was still young and dumb full of come. I digress.

Anyway I was thinking how horrible and unfair the deregulation was on utilities, stock owners, employees, and the rate payers. So during Q&A time I rose my hand and asked how could this be a good thing for anyone? The execs just laughed at this idiot who just asked a very stupid question.

The CEO put up a few slides on the Overhead Projector. First was Stock Price had shot up 20% in a week which is unheard of for utilities, second slide which had not been released to the public as of yet were the 3rd party resellers price list and the rates were 20% less than what the utilities charged. How could that be? So the CEO said hey stupid; 35% of our operating cost is BILLING and keeping track of accounts. We just eliminated all that cost and the employees. We no longer have unpaid accounts. Everything is wholesale to the 3rd party vendors who pay every month on time for every Kwh they consume.

Damn I learned that day I was young, dumb, and full of come. I became a man that day, and learned how to manage and invest money. Pass the risk down to smaller more efficient vendors. All those laid off employees became the vendors and got rich. That happened to me when the Telecom went bust and I got laid off. I made my own company and continued to do what I did before making a lot more money while saving the company I worked for even more money. Survival my friend.

Fair enough and understood. I too have played the game and believe I understand some of how it's run. One common characteristic I, and most anyone with an eye and a balloon knot saw was that O & M costs (and just about every other expense) are padded/buried/obscured, with the pads, etc. buried to the point that true costs and margins are impossible to determine with the published numbers only having some vague relation to reality. Example: gov. cost + 15% contracts that wind up w/40% + margins. Never seen or been a part of those things, but heard enough rumors to believe they happen.Or, the types of schemes Peakbagger described a few days ago as relates to interlocked solar companies are not unusual to my experience. One only need ask any decent project manager, or their project cost accountant how it's done.

The whole point of my initial response was that since real costs and any say over rates/tariffs are impossible for Joe/Jane homeowner to even know, much less have any say over, it seems time and resources would be better spent, among other pursuits, understanding and reducing use. The knowledge gained and more retained $$ resources seems a better return than stewing about things that are not even knowable much less controllable.

[SunEagle]

I pay a flat rate of around 12 cents per KWh which I don't think is crazy, but it went up over 15% on Jan 1. It is higher than some areas and a lot less than other areas. My bill is $66 a month on a budget plan.

Some areas instead of charging less for more KWh they charge significantly more for more usage. In those areas with high air conditioning usage it is nearly impossible to stay out of the higher tiers unless you don't use the air conditioner.

Higher tier rates are found in states that their POCO's can't provide enough power during peak usage so they penalize anyone that uses more. Other states charge less per kWh the more you use because they have a lot of power generation and again others charge the same no matter how much you use.

While it is not a simple solution you can always move to a state where the electric rates are lower if your bill is so high you can't afford to pay it. IMO if your electric bill is high then just about every service and product is also high.

It is all relative to what people can afford and what they like to complain about. For me I like to complain about how much my medical insurance is because that costs me 5 times what I pay for my electric each month. But that is a different story.

[J.P.M.]

For me I like to complain about how much my medical insurance is because that costs me 5 times what I pay for my electric each month. But that is a different story.

Moral to the story: Be careful when doing electrical work and definitely keep your digits and other things out of electrical sockets to keep medical bills < 5X electric bills.

Or, move to a high electric cost area to make med. ins. <5X of electric bill.