People using less energy in California could see an overall increase in their power bills if the California Public Utilities Commission (CPUC) approves a new monthly fixed charge.
The proposal comes as utility costs like sewer and water bills are on the rise across the nation. CPUC officials will vote on the decision Thursday. If approved, the decision would allow state utility companies to include a fixed charge of $24.15 on each monthly power bill. In return, the utilities would reduce the price of electricity by 5 cents to 7 cents per kilowatt hour, the Associated Press reported.
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The price reduction would prove beneficial to households using high amounts of energy each month, such as those living in hotter parts of the state running their air conditioners consistently or those who charge their electric vehicles at home. But for residents who use less energy, it could cause an overall increase in their monthly bill.
A CPUC spokesperson told Newsweek that, if approved, the fixed charge would go into effect in late 2025 or early 2026.
People could see a reduction of $33 over the course of the summer just in the savings acquired from running their air conditioner under the new energy cost, the AP reported. Savings could be even higher—up to $44 per month—for people who own electric vehicles and charge them at home.
However, for energy-conscious people—or those who live in smaller buildings like apartments and use less energy—the fixed monthly cost could be more than the reduced energy prices will save them.
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Critics of the proposal have argued that the fixed charge could deter Californians from being energy-conscious. California Representatives Mike Levin and Mike Thompson, both Democrats, wrote the CPUC in March expressing their concerns over the proposed charge.
"We are concerned that a high fixed charge could undercut investments in renewable energy and energy efficiency that Congress intended to encourage with the Inflation Reduction Act," the representatives wrote in the letter. "We are further concerned that a high fixed charge could increase the electricity bills of millions of Californians, especially those who live in small homes, condos and apartments. Such setbacks could harm our progress on federal and state clean energy, climate, and equity goals."
However, proponents of the proposal, such as utility companies, argue that the fixed charge would make acquiring clean energy more affordable.
Southern California Edison, the primary electric utility company for much of southern California, posted in favor of the new charge on X, formerly Twitter, in April. A spokesman for the company said that SCE won't make any additional money if the fixed charge is approved.
The post, which included a video, said, "If the new fixed charge proposal is approved by the CPUC, it would help @SCE customers, establishing a reasonable flat fee for grid charges and lowering electricity costs for SCE residential customers, especially those with more modest means."
The spokesman in the video said the fixed charge would reduce customers' electric cost by 12.5 percent and make electricity more affordable for those who want to "adopt clean technologies like electric vehicles."
Update 5/9/24, 12:46 p.m. ET: This article was updated with additional information.
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Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
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Anna Skinner is a Newsweek senior reporter based in Indianapolis. Her focus is reporting on the climate, environment and weather ... Read more
