California Plans Novel Shift in Electric Bills

Wealthy residents will pay more under new state law, and they're not happy about it
By Steve Huff,  Newser Staff
Posted Jun 6, 2023 3:32 PM CDT
Updated Jun 10, 2023 12:10 PM CDT
California to Adjust Electric Bills Based on Income
   (Getty Images / Trek and Shoot)

It could be a revolutionary twist for the energy sector: California will soon issue income-based electricity bills, reports the Washington Post. The state with some of the nation's highest electricity costs—1.5 to 2 times the national average—is shaking things up a bit. By 2025, the cost of a California resident's electricity bill may have less to do with energy usage and more with the size of their paycheck. The details have yet to be finalized, but the Guardian cites a California Public Utility Commission's proposal that within two years, Californians earning over $180,000 a year will need to shell out about $500 more annually. Conversely, those with an annual income of less than $28,000 could save up to $300 per year.

The state argues this is part of a larger, more equitable transition away from carbon as an energy source. California's electricity prices have been consistently among the highest in the nation, thanks to the state's unique challenges. As the Guardian notes, with utility companies shouldering the cost of damages from wildfires and subsidies for rooftop solar panels—among other costs—the price of electricity use has skyrocketed. Add to this the state's ambitious decarbonization goals, and you have a recipe for a hefty electricity bill. According to proponents, this income-based model will allow utility companies to lower the price they charge for using electricity by collecting more money from fixed charges.

All this has ruffled more than a few feathers among high-income earners. Wealthy residents have voiced opposition in public comments, some even canceling planned solar installations. The pushback hasn't deterred advocates of the plan. They argue that the status quo is unfair and that everyone can't turn to solar energy while other costs are borne through per-kilowatt-hour charges. In the ongoing conversation, one thing seems certain—California's novel move is sparking a national conversation about equity, energy, and ecology. (More California stories.)

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