PG&E sparks outrage with shameless move that will pummel 16 million across California

PG&E is facing a wave of backlash after asking state regulators to approve a rate increase that would help fund a $26.6 million shareholder incentive payment — a move critics say comes as millions of Californians are already struggling with soaring utility bills.

The utility company, which provides electricity and natural gas to roughly 16 million people across 70,000 square miles of Northern and Central California, says the proposed increase is tied to money it saved customers by purchasing natural gas at lower-than-expected prices between in 2022 and 2023.

Customers collectively saved about $170 million because of the company’s gas purchasing strategy, according to PG&E.

“The PG&E rates keep going up and our Social Security doesn’t. So it’s hard to balance the budget here,” Antioch resident Janice Mercado told NBC Bay Area.

“We all have to count our pennies, that’s why we’re here at the senior center activity or social activity that doesn’t cost a fortune.”

Mercado questioned why the savings were not simply returned to customers.

“Why don’t we get the reward?” she asked. “We’ve been paying bills, give it back to the people that are paying the bills, it’s hard for seniors to make our bills.”

Under rules established by the California Public Utilities Commission (CPUC), most of those savings remain with customers, while shareholders may receive a performance-based incentive if procurement costs fall below market benchmarks.

“Under CPUC rules, customers retain the majority of those savings, while shareholders may receive a performance-based incentive when procurement costs are lower than the established market benchmarks,” PG&E said in a statement.

If regulators sign off on the proposal, the average residential gas bill would increase by roughly 41 cents per month.

The request has nevertheless angered many customers, particularly those already grappling with some of the nation’s highest utility costs.

Janice Henry, another Bay Area resident, said the proposal was especially difficult to accept given PG&E’s history.

“PG&E needs to drop the rates instead of raising the rates. They need to get back to the consumers instead of the big pocket people who already have plenty of money,” Henry said.

“It seems like PG&E has been the cause of a lot of the fires, people have lost their lives, their homes, their livelihoods, their families, and we’re the ones paying for what they did wrong. We didn’t fail to check the equipment. We’re paying bills for what they have done,” she added.

Consumer advocates also blasted the proposal.

Mark Toney, executive director of The Utility Reform Network (TURN), argued that customers already bear the financial burden when PG&E exceeds spending expectations, making it unfair for them to also finance rewards when costs come in below projections.

“Because PG&E thinks they did well and keeping it not too high, they wanna reward just for doing their job. And their job is to keep rates as low as possible,” Toney said.

“If they want their shareholders to be rewarded when they underspend, then their shareholders should be held accountable when they overspend. And that’s not what PG&E is asking for.”

The controversy comes as Californians continue to face mounting utility costs.

The California Public Advocates Office recently projected PG&E rates could climb by as much as $840 annually by 2030 compared with current levels, though the utility has disputed those estimates.

The average PG&E customer currently pays about $285 per month, or roughly $3,420 a year, for service. Some customers say the financial strain has already forced major lifestyle changes.

One Bay Area resident previously told The California Post she spent nearly $9,000 on PG&E gas and electric bills last year, while a Fresno homeowner said she invested $21,000 in rooftop solar panels and a backup battery after becoming frustrated with rising utility costs.

The California Public Utilities Commission is expected to decide whether to approve PG&E’s shareholder incentive request sometime next year.

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