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17.5% Rate Hike Proposed for Residential Customers
July 2, 2008
Utility
cites rising costs and the need to step
up infrastructure replacement
Along with
the price of a gallon of gas and staples
like bread and eggs, the cost of keeping
the lights on is likely to increase as
much as 17.5% in 2009 for residential
customers of Southern California Edison
Co. SCE has notified its customers,
including the City of Duarte, that it
has filed an application with the
California Public Utilities Commission
to increase retail rates for all of its
Every
three years utilities are required to
forecast the cost of serving customers
and, after reviewing such forecasts,
regulators set each utility’s authorized
revenue levels for the following three
year cycle. This is known as phase 1 of
a General Rate Case. SCE anticipates
higher utility costs and has requested
the equivalent of a 6 percent rate
increase to cover them. SCE is
requesting additional revenues to
maintain safe, reliable service. The
cost increases are for:
1.Construction of additional facilities
to serve new customers and to reinforce
SCE’s power delivery grid to accommodate
growing electricity use.
2.Substantial capital investments to
replace aging distribution
infrastructure and business systems.
3.Significantly increased expenses to
meet regulatory requirements in
electricity generation and procurement
for customers.
4.Increased costs to step up
recruitment, training and retention
initiatives to assure that SCE has the
skilled workforce a large power system
requires in the decades ahead.
The CPUC
is expected to vote on Phase 1 of SCE’s
2009 General Rate Case in December.
In
addition to Phase 1, another part of the
Commission’s GRC process is to establish
costs, allocate revenues, and design
equitable rates for all customer classes
and is referred to as Phase 2 of SCE’s
2009 General Rate Case. During this
phase, SCE uses cost studies to develop
fair rates to all customers. The Phase 2
application, filed March 4, 2008, does
not request additional money, it simply
re-allocates the total revenue among the
various customer groups and sets rates
based on cost to serve. If the CPUC
grants approval of Phase 2 of SCE’s
application, some customer rates will
see an increase and other rates a
decrease in late 2009.
At the
time of the Phase 2 application, SCE
expected total average rate increases of
about 12% for 2009 compared to today’s
rates, though this number may be
adjusted in the future to account for
the record high natural gas prices that
are expected to continue. Compared to
the system average increase of 12%, SCE
seeks approval of a 17.5% increase in
electrical rates for residential
customers, a 20% rate increase for
street lighting, and 27.9% increase in
agricultural and pumping rates as these
groups are more costly to serve. Rates
for lower cost groups, such as lighting,
small and medium power customers and
large power customers, would experience
lesser increases of 7.4% and 6.9%,
respectively.
SCE
continues to provide energy efficiency
rebates and services to all customer
groups, including incentives for
installing energy efficient equipment,
low income and senior programs as well
as energy audits and opportunities to
shed load during critical energy peak
times with the air-conditioning cycling
program. Please go to: www.sce.com for
more information on programs and
conservation tips to save energy and
money.
The CPUC
will determine actual changes in rates,
if any. Before acting on SCE’s
application, the CPUC will hold public
participation hearings open to public
comment and evidentiary hearings open to
comment by authorized interveners.
Public hearings have already occurred in
Palm Springs, Visalia, San Bernardino,
Santa Ana, Long Beach, San Clemente,
Riverside and Compton. While only those
who are parties of record can present
evidence or cross-examine witnesses
during evidentiary hearings, comments or
concerns about the application should be
directed to the CPUC Public Advisor who
will circulate comments to the
Commissioners and other CPUC staff
working on the matter.
The public
is invited to address comments to: The
Public Advisor, California Public
Utilities Commission, 320 W. Fourth St.,
Suite 500, Los Angeles, CA 90013, or
e-mail comments to:
public.advisor.la@cpuc.ca.gov. When
writing, refer to Application 08-03-002,
and specify if you would like a
response. Otherwise no response will be
sent.
Customers
may view and download SCE’s application
and supporting papers on SCE’s website,
www.sce.com, or request a copy of
the materials by sending a written
request referring to Application
08-03-002 to Southern California Edison
Co., P.O. Box 800, Rosemead, CA 91770,
Attention: Case Administration. A copy
is also available at City Hall in the
City Clerk’s Office. |
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