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SDG&E proposing rate hikes beginning in 2024

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Posted at 10:27 AM, May 17, 2022
and last updated 2022-05-17 20:35:01-04

SAN DIEGO (KGTV) — San Diegans are already paying some of the highest electricity rates in the nation -- and SDG&E is proposing to raise them even more.

In a news release Tuesday, the investor-owned utility said it wanted to fund a wide range of infrastructure improvements that would help California reach its climate goals while also protecting against wildfires.

If approved by the State Public Utilities Commission, the average residential customer would see a $9 increase on electricity, and $9.60 increase on their gas bills compared to what they would pay in 2023. The increases would make for a 5.6 percent increase over SDG&E'S 2023 electricity rates, and an 18.1 percent hike over 2023 gas rates for the typical residential customer.

“Average electric bills at our company are the lowest among California’s electric investor-owned utilities, but we also recognize this is a difficult time to ask our customers to pay more given the state of the economy and inflationary pressures and are mindful of every dollar that we ask our customers to pay," SDG&E President Bruce Folkmann said in a statement. "Given the changes in climate and the growing need for a clean energy future, this will ultimately result in improvements that create long-term benefits now and for future generations. The budget proposal we put forth represents the conscientious efforts of hundreds of SDG&E employees to strike the right balance between holding down costs and making the infrastructure investments needed for a clean energy future.”

SDG&E is not allowed to profit off of electricity and gas, but can from infrastructure improvements such as the ones it is proposing. These include expanding electric vehicle charging infrastructure, modernizing the electric grid to enable the integration of more solar and wind generation, developing additional clean fuel sources, reducing wildfire risk and minimizing public safety power outages by hardening 590 miles of power lines between 2022 and 2024 through under grounding or insulation, and strengthening cyber security.

Still, Nicole Capretz, founder of San Diego's Climate Action Campaign, expressed concerns about the proposed rate hikes. She noted it's unclear how much of the increase is directed to profits versus actual project costs. She added that SDG&E parent company Sempra reported record profits earlier this year as utility bills increased.

"It doesn't feel like this is actually reflective of the cost of the electricity or the infrastructure, it feels like this is profiteering," she said. "It is a black hole, this rate making process, and certainly a black hole to any average San Diego family member."

SDG&E says electricity rates increased by 7.6 percent in January largely due to high natural gas prices. The utility says it expects the state Public Utility Commission to make a decision within 18 months. If approved, the rate hikes would start Jan. 1, 2024.