Rate hikes appear on bills sent this week

By Lukas Velush

The Desert Sun

June 4th, 2001

Don’t buy those new shoes just yet, and forget about going out to dinner.

If you used your air conditioner much at all in May you had better save, save, save.

The first bills to show the new 19 percent rate increase for Southern California Edison customers should start going out in the mail early Tuesday.

Air conditioner-happy Coachella Valley residents could be among those hit the worst by the rate hike because it punishes people who use the most power.

However, the biggest problem for valley residents may be that the California Public Utilities Commission views May as a winter month.

In the winter, valley residents are allowed to use 8.8 kilowatt hours per day before their price for power begins to climb. In the summer -- when hot weather makes power use in the desert soar -- valley residents get to use 42.7 kilowatt hours per day before paying more for power.

The problem is that the PUC views summer as June, July, August and September.

So when the PUC announced two weeks ago that the rate hike approved in March would fold into its existing system of winter and summer seasons, that meant valley residents would pay extremely high power bills in May.

"We’re going to be sending out this insert in this month’s bills that will explain the rate increase," said Steve Hensen, an Edison spokesman.

The new rate structure is based on something called a baseline rate.

The PUC established a baseline as the amount of power consumption that’s about 60 percent of average power use in a particular climatic zone.

The baseline fluctuates in different parts of the state depending on how much power is needed to heat or cool that area.

In the Coachella Valley baseline in the winter is 8.8 kwh per day. In the summer it’s 42.7 kwh per day, by far higher than any other region in the state. In cold climates, electric customers have a higher baseline, when demand is highest, and a lower baseline when the seasonal weather is milder.

Under the old rate structure, electric customers would pay 13 cents per kwh up until they reached baseline. The PUC required that people pay 15 cents for every kilowatt they used over baseline.

The new rate structure doesn’t change the first two tiers at all, it simply adds three more levels. You pay more per for each level you climb.

The old 15-cent rate is now cut off at 130 percent of baseline. Starting at 131 percent of baseline you pay 20 cents per kwh. At 201 percent of baseline you pay 24 cents per kwh. Above 300 percent of baseline you pay 26 cents per kwh.

Although May temperatures may not seem that different from June, the amount of power the PUC allows power customers to use before they start paying for the rate hike is different.

For example, in May you only get to use 273 kwh hours before you start climbing up the price-hike tiers. In June you get 1,281 kwh before you start paying more for power. And June even has one less day then May.

At least one Coachella Valley resident is expecting the worst when she gets her May bill.

"Staying under baseline is impossible," said Lee Alvarez, a Palm Springs resident who said her family tried hard to reduce its power use in May. "I’m going to be way over."

According to Edison statistics on historic power use in the valley, about 47 percent of valley residents will not be affected by the rate hike in the winter months, and 54 percent of won’t be affected during the summer.

The state is using the money from the rate hike to buy power on the open market, a cost that has soared to about $50 million per day.

-- PHO (owennos@bigfoot.com), June 04, 2001

Answers

This is certainaly going to discomboble bill-receiving Californians. Very few will be able to understand this May as a winter month interpretation, and flood their utilities with complaints.

-- Uncle Fred (dogboy45@bigfoot.com), June 04, 2001.

It also depends on which power company you are with. SMUD's baseline is 700 kwh per month. PG&E baseline is only 400 kwh per month. I don't know what other small utilities are allowing. Could make for interesting bill comparisons this summer.

-- Margaret J (mjans01@yahoo.com), June 04, 2001.