DRA Urges CPUC to Clamp Down on PG&E’s Request to Raise Rates by $4.2 Billion
San Francisco, May 6, 2010 - The Division of Ratepayer Advocates (DRA), an independent consumer advocacy division of the California Public Utilities Commission (CPUC), issued reports calling for Pacific Gas and Electric Company’s (PG&E) proposed $4.2 billion rate increase request for the next three years to be cut down significantly by the CPUC.
PG&E’s 2011 General Rate Case (GRC) addresses the utility’s request for authority to increase rates effective January 1, 2011. PG&E seeks a revenue increase of $1.1 billion, or 19.7 percent, beginning in 2011, with additional increases of $275 million (4.1 percent) in 2012 and $343 million (4.9 percent) in 2013. Considering all three increases over the three years, this amounts to a cumulative rate increase of $4.2 billion.
Based on its independent analysis, DRA recommends the CPUC approve lower revenue increases of $227 million (4.1 percent) in 2011, $116 million (2.0 percent) in 2012, and $107 million (1.8 percent) in 2013, for a cumulative increase of $1.02 billion over the three years. This represents a 76 percent reduction relative to PG&E’s request.
In its GRC filing, PG&E has asked for additional revenues to cover costs associated with its electric and natural gas distribution and electric generation operations. PG&E asserts that additional revenue is needed to cover higher costs associated with, among other things: operating and maintaining its systems; serving its customers; administrative and general expenses, including employee salaries, health benefits, and outside contractors; and capital investments. DRA’s own independent forecasts of these costs over the next three years are $3.2 billion lower than what PG&E estimates.
Evidentiary hearings for PG&E’s 2011 GRC are scheduled to begin on June 21, 2010, at the CPUC’s headquarters in San Francisco.
Electronic versions of the DRA reports addressing PG&E’s rate case, including a more detailed executive summary, are available on DRA’s website at www.dra.ca.gov/DRA/energy/GRC.
For More Information Contact
Tom Hall
Information Officer
415-730-2964
tbh@cpuc.ca.gov
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David Ashuckian
Deputy Director
415-703-1977
daa@cpuc.ca.gov
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